Debit Card Questions and Opinions

As for the debit card linked to your checking account, you are charged a small fee each time you use the card as a "debit" and put in your PIN.

However, if your card has a Visa or Mastercard, you can make purchases without the fee by using the card as "credit". I do not forsee businesses changing this anytime soon due to the number of people who use credit cards these days. I kind of remember back to when gas stations had a cash price and credit price. I think those days are gone and won't come back.

I love my check card and use it all the time. Rarely, do I have any cash on me.

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They go through as any Visa card would and merchants have been charged a fee since credit cards began.

So pretty much these fees have been used to allow banks to offer services that otherwise would require fees or minimum balances. The merchants complained that these high fees, like 15 to 25 cents, were being passed on to consumers that used the cards through a small markup in the price of goods.

Congress in their infinite wisdom says hey we can't have that and capped the fees at I think 5 cents. Brilliant so now all the services that were offered by the bank using that fee will now be charged or some are just charging the difference directly to the consumer when the card is used.

I think someone needs to put up a huge banner in both charmbers of congress that says there is no such thing as a free lunch!

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Yes they pay a fee every time you swipe a card, be it debit or credit. I know at one place, a small family-owned pool store, they do tell the cashiers which is cheaper for them so that if a customer has a choice, they can advise/ask them to use the cheaper one (I think at this place it's debit). Credit card fees are typically 2-3% of the purchase price while debit card fees are usually 1-2%. Retailers already include these charges in their pricing models and pass the costs on to us. There has been legislation proposed for several years designed to cap this at a hard amount per transaction (vs. a % of the whole transaction) but as of right now, it doesn't look like anything has been passed.

FWIW, retailers also pay for check processing, but I think that's a monthly flat fee to pay for that VeriSign service.

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This is not a new charge and is sort of the cost of doing business. I am sure businesses have been passing the cost on to us for years. By reverting back to writing a check or paying cash will retailers drop their prices? No! Is the check/debit card more convenient? Yes! Do we as consumers buy more when we pull out the plastic rather than the cash? Yes! So even though it stinks that the retailer has to 'pay' to complete our transaction, they are still reaping the rewards of us using cards at the register rather than cash.

There are some businesses that offer a reward for paying with cash. Those are the only businesses I would use cash with, otherwise I would keep swiping.

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It costs more for a store to handle a check than it does the debit card. Keep swiping. Big Brother will always make sure to charge business owners for doing business in one way or another. Don't inconvenience yourself trying to fix our broken, unfair system.

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But...check with your bank to see what they may or may not charge per debit transaction. My bank charges nothing...and your charge might be low enough that you think it to still be worth the ease of transaction in using your debit card over a check book.

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I do the books for a business that takes both credit and debit transactions and We DO get charged for each and every transaction. For us its cheaper to run a debit. We basically included the fees in our expenses so that we know how much to charge..

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I get charged $0.25 each time I use my card as debit, but don't get charged at all if I use it as a credit.

Pisses me off and I only use it as debit if I have no choice.

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Anytime you swipe a card the retailer is charged a small fee. As long as I've worked in businesses that took cards, over 10 years, this has always been the case.

ETA: Pamela, that's a good point. I havent used my card as debit in forever, because of that, but it's tied to Visa so I use it as credit. I was actually thinking of credit cards, not debit, that charge a fee.

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The has always been a charge for retailers to accept credit or debit transactions. This is not new. Thats why gas stations used to charge more for credit than for cash. But they don't do that anymore. Everyone ends up paying for it in the price of the merchandise. Banks are now charging ATM fees who didn't used to charge a fee. So watch out, TD used to be free ATM use but now they charge a fee for every time you take money out at a foreign ATM. So you could get charged twice, once from the bank who owns the ATM machine, and once from TD( your bank) for the same withdrawal. You can only use TD ATMs to avoid the fee. Beware!

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Not exactly what you asked, but I'm going to throw it in anyway. I always use my card as "credit" because when you run it as credit you get the same fraud protection from Visa as if you use an actual credit card. I can't speak on a mark-up on products but I don't feel like I've ever paid more than if I had paid cash. There might be a mark-up in there, but it seems like we are all paying it regardless of our method of checking out.

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I have been using cash more now so that people cannot steal PIN from those little card readers and get direct access to my cash in my bank.

I just always ask the merchant if they would prefer I run my card as a debit or a credit charge. Some merchants will tell me if they are charged a processing fee for a debit (or credit) transaction - then I just process the payment on the one that doesn't charge them a fee.

I also try not to run the card for a transaction under $10, as many banks will now charge the merchant a fee if the transaction is under a certain amount (usually $3 to $5 dollars).

If we practice responsible consumerism then we can all keep costs down.

A law has just been passed which PREVENTS banks from charging the store a fee when we use our debit card as a credit. I actually just got a letter from my bank about this yesterday.

As a result, I will no longer get rewards points for using my debit as a credit. This is because my bank is no longer making money when I swipe my debit card as a credit and they are no longer passing the rewards on to me. I do however still get rewards points for using my actual credit card.

Don't inconvenience yourself by writting checks and withdrawing more cash than you need. Unless you just don't want to use your debit card of course :o)

That is true so that's why I always write an old fashioned check when I'm at a locally owned mom and pop store. *Even my dry cleaner, bless her heart, will just hold my tickets (I get the clothes) if I don't have my checkbook and I can pay next time I come in. An extra benefit of having a good relationship with local small business owners!
Otherwise I don't think about it and use a card. Well, except at Macy's where I'll use my American Express who charges the highest fees! Of course there is a story there, and I'm sure a huge corporation really doesn't care that I'm trying to make a point. Which is actually beside the point of your question.