Did Congress Kill the Debit Card?

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By Daniel Indiviglio Sep 30 2011, 9:32 AM ET Comment
http://cdn.theatlantic.com/static/mt/assets/business/275 debit boa MoneyBlogNewz flickr.jpgSome Americans are outraged that Bank of America intends to charge its customers a $5 fee for using their debit card. And simply switching banks might not help: others are expected to follow. While frustration over yet another bank fee is understandable, this one should surprise no one. Congress acted to cap the debit fees that banks could charge retailers last year, and banks are reacting by directly charging their customers a portion of these lost fees to make up the difference. The move could mean the end of the debit card.

theatlantic.com/business/archive/2011/09/did-congress-kill-the-debit-card/245935/

Helping the poor ends up helping the well-to-do folks. Thank you, Obama and the Democratic Party.
 
If so, very little loss IMO. The debit card is the prime vehicle for scammers to steal money from people via ATM machines. I use mine only at fast food places, and never to get money from an ATM.
 
Rich_Olszewski said:
If so, very little loss IMO. The debit card is the prime vehicle for scammers to steal money from people via ATM machines. I use mine only at fast food places, and never to get money from an ATM.
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I use mine for everything, groceries, gas, etc. I don’t use it to get cash, though. Explain how using for getting money out of an ATM is different from paying for things? My nephew used his debit card at a BOA ATM and had some money stolen due to this transaction!

I bank at a credit union, so hopefully it won’t affect me.
 
Well, it looks like it’s back to using cash!!!

I don’t like how cards of any time leave a paper trail anyways. You can either get your card information stolen, or other people look at your payment history. The only bad thing, is that I won’t be able to establish credit when I want to buy things like a house… too bad society runs off of having “credit” and a “credit score”. Famed economist and money manager Dave Ramsey is adamantly opposed to being forced to use credit and credit scores.

You can’t beat cash
 
The problem with such plans is that the savings are almost never passed on to the consumer. Once people are used to paying a certain price there is absolutely no incentive for a seller to lower their prices when the costs go down, especially if the price is inflated across the whole industry.

Just look at what happened when the airline tax lapsed for a short while: the airlines kept the prices up and pocketed the extra money. I think perhaps one major airline lowered prices for that time, but most of the industry held firm and raked in the money. Theoretically the company that cuts its prices would have a competitive edge, but in reality the pressure on prices is upwards, not downwards, as the industries continually push prices up and see where the “breaking point” is in consumer desire for the product/service. As long as most of the industry does this at the same time there is little alternative for cheaper goods and services, and the consumer will swallow the new prices out of necessity.

As for debit cards, I guess I’m just going to have to go to carrying around cash like I did in my youth. 🤷

Peace and God bless!
 
qui_est_ce said:
I use mine for everything, groceries, gas, etc. I don’t use it to get cash, though. Explain how using for getting money out of an ATM is different from paying for things? My nephew used his debit card at a BOA ATM and had some money stolen due to this transaction!
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You’ve answered your own question. There are devices scammers use to be able to get information that they can use on phony debit cards. It’s a big and a sophisticated operation worldwide.
I bank at a credit union, so hopefully it won’t affect me.
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I use a smaller bank that used to offer 6% interest on Checking accounts ! (now down to 2%) that is most unlikely to charge for debit cards (they want business and aren’t trying to drive it away.) On top of that, it offered all sorts of bennies to us geezers over the age of 50. What was not to like? 😃
 
Rich_Olszewski said:
You’ve answered your own question. There are devices scammers use to be able to get information that they can use on phony debit cards. It’s a big and a sophisticated operation worldwide.
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What I wanted to know is does this happen when you use it at the grocery store?

Like why do you used it at fast food places only?
 
All regulations have unintended side effects. In this case, one of the side effects is that of transferring costs from retailers to consumers. Actually one might argue that is more fair, except, as someone else has noted, retailers likely won’t reduce prices as a result of the reduced cost to them of accepting debit cards.

I’ve been using a debit card more lately because it’s easier and quicker than writing a check. But if my bank imposes fees, I’ll go back to using checks. But they might impose more fees on checks too.
 
qui_est_ce said:
What I wanted to know is does this happen when you use it at the grocery store?

Like why do you used it at fast food places only?
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Well, sometimes at Kroger’s. Small purchases only. It has to do with how I tally my monthly expenses and keep from fainting when I see how much has been spent.

I think - I may be wrong - that if one gets scammed through one’s credit card, the amount of loss is minimalized legally ($50?), but when some scammer steals from you via a debit card, your losses can be your entire bank account (!!!).
 
Rich_Olszewski said:
The debit card is the prime vehicle for scammers to steal money from people via ATM machines. I use mine only at fast food places, and never to get money from an ATM.
Click to expand...
Being a student, I use my debit card most of the time. I have heard of the ATM scam before, though. I try to have cash on me, but it is surprisingly hard to find an ATM machine for my bank.
 
MugenOne said:
By Daniel Indiviglio Sep 30 2011, 9:32 AM ET Comment
http://cdn.theatlantic.com/static/mt/assets/business/275 debit boa MoneyBlogNewz flickr.jpgSome Americans are outraged that Bank of America intends to charge its customers a $5 fee for using their debit card. And simply switching banks might not help: others are expected to follow. While frustration over yet another bank fee is understandable, this one should surprise no one. Congress acted to cap the debit fees that banks could charge retailers last year, and banks are reacting by directly charging their customers a portion of these lost fees to make up the difference. The move could mean the end of the debit card.

theatlantic.com/business/archive/2011/09/did-congress-kill-the-debit-card/245935/

Helping the poor ends up helping the well-to-do folks. Thank you, Obama and the Democratic Party.
Click to expand...
If the banks don’t like the low labor transactions of electronic funds transfer with debit cards, then perhaps everyone should protest by writing a paper check for every purchase for a week, and also going into the branch to make all withdrawals and deposits in person. Debit cards save the banks a lot of money by reducing their labor requirements compared to old fashioned banking in person.

Once the banks hire extra employees to handle the personal traffic, then everyone should stop that and start using their debit cards. Then the debit fees would be offset by the higher payroll the banks were now paying.

Consumers can have power, if they are organized.

The notion that the banks were too big to fail, and therefore should be bailed out, has resulted in industry consolidation financed by the taxpayer. The now larger banks feel more emboldened to charge their customers who have fewer options to go elsewhere.
 
JimG said:
I’ve been using a debit card more lately because it’s easier and quicker than writing a check. But if my bank imposes fees, I’ll go back to using checks. But they might impose more fees on checks too.
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Many places, particularly restaurants, no longer accept checks.
 
Catholic90 said:
Many places, particularly restaurants, no longer accept checks.
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Ah well, there’s always cash. But I know some people who never carry cash at all.

And I much prefer to use a smaller local bank than one of the big banks.
 
JimG said:
Ah well, there’s always cash. But I know some people who never carry cash at all.

And I much prefer to use a smaller local bank than one of the big banks.
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Right. Who has ever heard of my bank, the Bank of Little Rock? Or even of the East Bank of the Mississippi?
 
FormerWarrior said:
If the banks don’t like the low labor transactions of electronic funds transfer with debit cards, then perhaps everyone should protest by writing a paper check for every purchase for a week, and also going into the branch to make all withdrawals and deposits in person. Debit cards save the banks a lot of money by reducing their labor requirements compared to old fashioned banking in person.
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Bank of America charges for teller transactions!!!
 
qui_est_ce said:
Bank of America charges for teller transactions!!!
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I once wanted a bank that I could write checks on, here and in NYC. There was only BofA. Yikes, $7/mo, then $9 monthly fee, ripoff overdraft charges (though I NEVER have overdrafts) and everything else that is customer-hostile. Closed that account after two trips to the Big Apple. 🙂
 
Back to writing checks for Walmart etc Plus will need cash now to go out to eat. Darn it.
 
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