This will affect businesses that do 3rd party merchant services, like events. If the event is cancelled, refunds are issued. Who pays that fee? It would be up to the business to try to claw back funds from the promoter of the event... who is now bankrupt from not being able to do their event. It gets ugly fast.
I think that's why (well one of the reasons along with generally poor behaviour) most ticketing sites tag on so many extra "service" charges. Some charge to even receive a digital copy of your ticket! I believe they don't have to refund these charges when the event is cancelled.
The extra fees are simply a way to gouge end users. It has nothing to do with refunds and it is also often out of the control of the promoter of the event.
When I built an event ticket sales site, we tried to get promoters to just raise their ticket prices a bit to include the 'service fees' so that end users got a single price, and they refused.
Promoters just want to advertise $25, not $32.50 (contrived example)... they don't care that the end user has to pay the additional fee. We did all of the math analysis and the end user total cost could have been lower, while the promoter got more money, with our method, but perception is king.
It's only natural that "Promoters just want to advertise $25, not $32.50", so I think the only way how change is going to happen is by truth-in-advertising regulation that requires advertising the fees-included price, where it must be possible to actually get the thing by paying the advertised amount.
Yea, we tried very hard to promote T-I-A, but we were fought on it the whole way and at the end of the day, it was part of the downfall of our business. Promoters didn't want to list their events on our site because of that. It became a friction point for them, even though at the end of the day, the math was better for them and for the end user.
From the merchant service aspect, they provided the service (allowing the user to buy a ticket to an event), I don't see why they would have to refund their fees for that service.
In effect, for better or worse, that is also what Square is doing now too.
Of course, that isn't what the end user wants.
What the end user wants is the promoter of the event to refund them their ticket cost AND the fees. That would be up to the promoter to do that, which they aren't going to do since they are now bankrupt from not hosting the event.
I hate to bring up the whole 'crypto fixes this' thing here, but it does. The transaction fees on L2 chains are so low that the promoter could just afford to give full refunds in whatever stablecoin the end user bought with. There would be no square, credit card company or anyone else in the mix trying to dip their fingers into the pie. The whole problem revolves around the issue of too many cooks in the kitchen and some of those cooks are really corrupt.
Who is 'they' in your equation here? Also, tell me how a small merchant services business is going to get an insurance plan that covers something like that? This isn't 3% revenue on one single event, it could be on a number of events. What if a multi-event promoter goes out of business?
This also isn't just events, that is only one example. Any 3rd party merchant service provider is going to be affected.
Back when I had my events company, we went with WePay because they were the only service at the time that offered 'free' refunds. Eventually, it became the norm. Now it seems like this policy is getting reverted and that's going to have a large impact on merchant service providers.
> If the event is cancelled, refunds are issued. Who pays that fee?
Insurance. The promotor would have insurance to cover this. If the event was cancelled due to a performer cancelling, the performer's insurance will pay.
All this puts up the price of insurance, which puts up the price of event tickets.