Fees to cover Expenses

Transparent payment systems can incur fees.

If it were a volunteer-run system, Sensible Taler might be free from any expenses. But that would not help to build a stable alternative. Instead, it aims to have fair fees, and suggests users to demand the lowest fees possible.

Traditional fees for payment services can be very high. This is the kind of mechanism that free markets can help to control. The structure of Sensible Taler is mostly peer-to-peer, which help to avoid central players. A hub-and-spoke model commonly pops up in such networks, but they are opt-in choices and alternatives tend to stand up as a market alternative when lower fees are possible.

The fee structure of a credit card are, for example, a fixed fee around €0.25 per transaction, plus 2% of the amount. These levels are based on the insurance that usually comes with the card, which may also be used when the static numbers on those cards end up being abused. This explains the percentage. The fixed fee must also cover handling of consumer complaints.

The GNU Taler payment system is mostly like a cash payment, based on every-changing unguessable but strictly verifiable codes, which avoids most of these expenses. This should avoid these expenses, which are ultimately paid by a client and disadvantaging the competitive position of the merchant.

This reasoning also means that the multi-leg system for Sensible Taler is designed with peer-to-peer principles in mind. Centralisation leads to power concentrations, at the expense of market control over fees. The fees of an intermediate party can be fixed to computer updates, moving along with other business practices, so they can be offered as free service to their peers, where it is visible and therefore works as free advertisement (from being a reliable relay service).