> Not really ... Places selling similar items tend to accept the similar common payment methods.

The point is that sometimes the alternative isn't a similar item.

Suppose you're a restaurant. The customer can either pay you to make food or buy it from the grocery store for 1/5th as much money and then spend the time to make it themselves. If both you and the grocery store were to raise prices by the same percentage, your price increases by five times as much as the grocery store price, because the time cost of preparing the food themselves wasn't taxed by the credit card companies. So if you raised the price, more people would stay home instead of coming to your restaurant, and then you have to do the math on whether the reduced sales volume or the reduced margins will hit you harder, and sometimes it will be the first one and you have to eat the second one.

> and it doesn't at all if you get charged a markup for paying with a credit card.

Also not true, because if you do raise the price then demand goes down, so instead of making lower margins you make lower sales.

Moreover, customers have a finite amount of income. If some amount of that is going to the credit card companies then it isn't going to the seller of whatever they would have bought if they still had the money in their pocket. Which sellers are getting screwed by that the most is a complicated question, but it's definitely somebody.

> Investigations do happen, and cost the card issuer money.

But how is the investigation worth anything? The bank doesn't have the capacity to do a real investigation.

Suppose you order some electronics, pay $5000, and then tell the bank that the seller sent you a brick instead of the electronics you ordered. How is the bank supposed to know who is lying? It could be a fraud by the seller (they actually sent you a brick) or by the buyer (you're trying to get refunded for goods actually delivered) and the bank has no way to know.

Whereas the police could do things like place other orders with the seller and investigate whether any of them come in as bricks, investigate the delivery driver to see if it was them rather than the seller who swapped it out and then see if they can recover the merchandise, etc.

> and if they were then we'd all be paying more taxes to hire a lot more investigators and judges.

The premise of the criminal justice system is deterrence. If the government is willing to spend $50,000 investigating a $5000 fraud, and as a result the fraud doesn't happen because the fraudster expects to be caught and go to jail, the government doesn't actually have to spend the $50,000 in the large majority of cases.

Whereas if all that happens to a fraudster is that the transaction is reversed by the bank 90% of the time, they're turning a profit because they get to keep the money the other 10% of the time and no one puts them in jail, and then you get tons of fraud.

So why are we trying to get the banks to do this at all? They have no real investigative powers and essentially no meaningful information about who did the wrong.