next »

[ellaminnow]

I've switched from using credit cards to only using a debit card for things like gas, groceries, etc.  I've noticed that in my past two statements I'm being charged a dollar for most of these transactions which adds up to about $15/month!  What is that all about? 

Did I miss something that should be common knowledge?  Why would anyone use a debit card if you're being charged for it each time? 

Help me out, here.  Octo?  Clean?  Anyone?

[concordancia]

You can usually avoid this fee by running your debit card as a credit card. Most automatic machines ask you, but sometimes you do have to pretty insistent.

[ellaminnow]

I don't know that I'm given the option at our grocery store.  The swiper just asks me to enter my PIN and then I'm good to go.  I'll have to pay more attention to this.  Is there always an option to use my debit as a credit card so as to avoid the fee?  If so, why doesn't everyone do this? 

[chaosbydesign]

I just now read about something like this.

(Info from Chase)

When you use a debit card to pay a merchant, or you initiate a deposit, withdrawal or transfer to your account, you authorize the transaction amount. These transactions will not be posted to your account until the bank receives and processes them.

For most merchant transactions, the merchant knows the exact amount of the transaction and asks you to authorize that amount. For example, if you buy $82.75 worth of groceries, the market would ask you to authorize an $82.75 charge or debit to your account. That amount would then appear as a pending transaction on your Account Summary until it was posted.

Sometimes, though, the merchant doesn't know the transaction amount until after the purchase is complete. A good example of this is at the gas pump. Before you fill your tank, you're asked to swipe your debit card to approve your purchase. A $1 charge may be placed on your account temporarily until it's replaced with the actual purchase amount. For example, if your gasoline purchase is $22.50, then that amount will be paid to the merchant and posted to your account. However, you may see a $1 charge in the pending transaction section of your My Accounts page for 1 to 3 days until the merchant submits the actual amount of your purchase. You should always immediately deduct the actual purchase amount from your balance, even though it could take a few days for the money to be taken out of your account.

Could this explain the charges?

[concordancia]

I don't know that I'm given the option at our grocery store.  The swiper just asks me to enter my PIN and then I'm good to go.  I'll have to pay more attention to this.  Is there always an option to use my debit as a credit card so as to avoid the fee?  If so, why doesn't everyone do this? 

I have had grocery stores where you had cancel when it asked for the PIN and then it processed the transaction as a credit card.

Or, you could contact your bank and threaten to leave if they do not stop charging you those fees.

[ellaminnow]

Or, I could just go back to using the good ol' credit card. 

I actually don't think my bank would care if I take my pittance out.  They'd say, "Don't let the door hit your butt on the way out!"  Ha.  I may have to rethink my spending strategy. 

Chaos, that's an interesting example of how some merchants work but these are actually fees that get incurred just because I'm using a debit card.  These $1 fees don't get returned after the transaction is complete. 

[chaosbydesign]

Good to know. I'm going to look out for charges like that, because I'm only using a debit card at the moment.

[concordancia]

LMNO, it is definitely worth asking about at the places you shop most frequently. Next time you go to the grocery store, ask the clerk, or even go to the customer service counter before you shop.

BTW, this debit card does have a Visa or Mastercard logo on it, right? If not, all of my advice is void.

[ellaminnow]

Yeah, it's a Visa debit card. 

I have to start being more attentive with these transactions!  I'm trying to be much more frugal to pay down my ridiculous amount of debt and $15/month for a bunch of nada is NOT an expense I've budgeted for (yeah -it's that tight).

[concordancia]

Yeah, it's a Visa debit card. 

I have to start being more attentive with these transactions!  I'm trying to be much more frugal to pay down my ridiculous amount of debt and $15/month for a bunch of nada is NOT an expense I've budgeted for (yeah -it's that tight).

Oh, I understand. I am having trouble getting used to coupons. It isn't like they very often offer coupons for things we actually buy.

[scampster]

Yeah, it's a Visa debit card. 

Then you should be able to run it as credit every time you swipe it. Just don't enter a pin (like mentioned above, you usually have the option to hit cancel to run it as credit) or tell the clerk to run it as credit.

But my debit card never has those fees. Hie thee to thy nearest credit union, stat!

[wet_blanket]

I have multiple debit cards (several banks were giving away money for opening an account) and have never paid  fee for using debit cards.  Two evil mega-banks, a credit union, and a couple of other banks.

Ella, is the charge from the bank or the merchant?  If it's the bank, you can probably switch account types without all the effort of switching banks.  If it's the merchant, name and shame them here.

[palla]

Chaos, that's an interesting example of how some merchants work but these are actually fees that get incurred just because I'm using a debit card.  These $1 fees don't get returned after the transaction is complete. 

The $1 charge should go through as pending and then get dropped with the "real" charge goes through. 

[concordancia]

Chaos, that's an interesting example of how some merchants work but these are actually fees that get incurred just because I'm using a debit card.  These $1 fees don't get returned after the transaction is complete. 

The $1 charge should go through as pending and then get dropped with the "real" charge goes through. 

Many banks charge a per transaction fee of $1-2. Merchants love it when you use debit because they don't have to pay the charge transaction fee, but banks often take it directly from the consumer.

[oak_and_ash]

Some banks charge a transaction fee for debit cards - it's ridiculous, but there you go. In addition to the idea of using your debit card as a credit card, or going back to credit, I would suggest transferring your account to a credit union.  I use my debit card from my credit union 20-30 times a month and never get charged fees.  They have better interest rates than a lot of the banks in my area too.  (It's my university credit union, but if your school doesn't have one, there should be a couple in your community that everyone is eligible to join, like Neighbors or eFederal).