Not Logged In Log In   Sign Up   Points Leaders
Follow Us    6:02 PM

Message Forum - Read Message

Category: General Gas Talk > Topics Add to favorite topics   Post new topicPost New Topic
Author Topic: What is the TRUTH about debit card pricing??? Back to Topics
Juanhanded

Rookie Author
Long Island

Posts:6
Points:220
Joined:Feb 2014
Message Posted: Apr 4, 2014 7:11:41 AM

Cash,credit card,debit card.On the pumps around here it is fairly clear what the pricing is for the first two,but debit is confusing.

When I researched it a few months back,it seems that gasoline retailers fought to have their card processing companies to stop charging debit fees as though they were credit fees,arguing that a debit payment was basically an instant electronic transfer of funds,that did not justify a 10cent charge per gallon because there was really no cost associated with it.

So,the way I understand it,they got legislation passed to limit it to a 35 cent flat fee charge per TRANSACTION.The same whether you pumped one gallon or a hundred.

So,the retailers fought for this and got the legislation passed.And then...they never passed the savings on to the customer.In general they kept banging them for the 10cent charge per gallon.

In my travel area,Long Island New York,I am noticing that some stations in the last 6 months have been dropping the debit fee altogether and making the debit purchase price the same as cash.The ones I see doing this most often is BP and Sunoco and some Shell.But it is still not consistent among all stations of the same brand and wildly inconsistent in general.

So,what is the TRUTH about debit charges for gasoline??????????
REPLIES (newest first) Post a Reply
Profile Pic
hjz
Champion Author Bridgeport

Posts:16,083
Points:3,168,520
Joined:Dec 2004
Message Posted: Apr 30, 2014 6:21:18 PM

 
Profile Pic
Juanhanded
Rookie Author Long Island

Posts:6
Points:220
Joined:Feb 2014
Message Posted: Apr 6, 2014 10:52:24 AM

OK,I am gathering a little more information on this Debit Card situation for the good folks at Gas Buddy.

In 2011 Federal legislation was passed regarding the usage of debit cards in the Durbin Amendment to the Dodd-Frank bill.The idea was to establish a "reasonable" charge for debit card transactions.

The law established this cost to be 21cents per transaction and .05% of the transaction total.This cost was established as "fair" to cover fraud protection for these transactions.Be aware that there is very little chance for fraud in a debit transaction for a retailer or financial institution.

The bottom line is that when the legislation was passed,the acceptable fee for a debit card transaction was established as 24cents per transaction(or swipe).Gasoline Retailers lobbied hard for this,they argued that such a low risk transaction did not deserve the same fees as a credit card transaction,which,of course,has much more risk involved with it for a financial institution.Lawmakers agreed and passed it into law.

Looks like a good thing for the average Joe who fills his tank,right?
Not really.

What seems to have happened is that upon the federal legislation being passed,card processing companies raised their processing fees for CREDIT CARDS to offset the money they were no longer able to charge for debit card purchases.Gas Station owners then decided not to pass on the savings to folks who used debit cards.They were not breaking any laws,it seems,as there was no requirement in the law for the savings to be passed directly to the person using the debit card,although that would seem to be the law's intention.

But the good news is this:Now many Gas Stations are making it plain that "Cash Price = Debit Card Price".

So now the pressure is on the stations that are still charging(wrongfully,to me)credit card fees for debit card purchases,fees they have been pocketing since 2011.
Profile Pic
Juanhanded
Rookie Author Long Island

Posts:6
Points:220
Joined:Feb 2014
Message Posted: Apr 4, 2014 10:18:51 PM

I spend about $400 a week on gasoline so cash is not always an easy option.

If the cash price is low and the cash price equals the debit price,that is a winning proposition for me.My bank does not hit me with am excessive charge for this and I have never had a hold placed on my account that was large enough for me to even notice.

What I would like to know is...are the card processors for gasoline retailers limited BY LAW to charge a 35cent charge PER TRANSACTION? That is the way I understand it,but it surprises me that there is not a lot of information out there.

This is important information for everyone.

I am aware that BP lost a suit in Oregon,I believe,for the failure to post signage warning customers of the 35cent fee.I think most folks would be happy with the 35cent fee,as opposed to the 7 or 8 times that,that most stations seem to be getting away with.
Profile Pic
Juanhanded
Rookie Author Long Island

Posts:6
Points:220
Joined:Feb 2014
Message Posted: Apr 4, 2014 10:05:26 PM

I spend about $400 a week on gasoline,so carrying the cash is not always an easy option.And I don't always hit the same station.And yes,I shop for the best price,those are the stations I choose to reward with my business.

If the cash price is low,and the debit price equals the cash price,that is a winning proposition for me.My bank does not kill me for an excessive fee for using debit,and I have never had a hold go on the account that was large enough for me to even notice.

What I would like to know is am I correct?Are the gasoline card processors limited by law to charge a flat fee 35cents per TRANSACTION for a debit card?

This is information that is important for everyone to know.
Profile Pic
kdanish
All-Star Author Santa Barbara

Posts:719
Points:227,180
Joined:Jan 2014
Message Posted: Apr 4, 2014 10:41:31 AM

Do not use a debit card
Profile Pic
MertieMan
Champion Author Lexington

Posts:17,224
Points:3,448,085
Joined:May 2005
Message Posted: Apr 4, 2014 10:03:47 AM

Use cash like I do, and then you won't have to fret.
Profile Pic
redfish67
Champion Author Dallas

Posts:1,415
Points:327,025
Joined:Dec 2013
Message Posted: Apr 4, 2014 9:36:05 AM

Won't use a debit card anywhere.
Profile Pic
bluenvoy
Champion Author Nashville

Posts:17,387
Points:2,144,865
Joined:Oct 2005
Message Posted: Apr 4, 2014 9:34:24 AM

If you use a debit card at the pump the stations pending charge can tie up a big chunk of your money for a day or so till the actual purchase replaces the pending.
Post a reply Back to Topics