Posted on 03/10/2011 1:08:35 PM PST by Whenifhow
.....Your debit card may soon be denied for purchases greater than $100 -- or even as little as $50. JPMorgan Chase, one of the nation's largest banks, is considering capping debit card transactions at either $50 or $100, according to a source with knowledge of the proposal. Why? Because of a tricky thing called interchange fees. Right now, every time you swipe your debit card, your bank charges the retailer an average fee of 44 cents, which it shares with its partners. ....
And consumers would end up feeling the pain when Bank of America is forced to recoup costs "by increasing the cost of their everyday debit card transactions, limiting their payment choices, and impacting industry innovation," ..... Aside from mulling over a limit on transaction amounts, Chase is already testing $3 monthly fees on debit cards and $15 fees on checking accounts in certain states.
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So with the Fed's proposed cap in place, banks argue they won't have the money to protect themselves against fraud. And, of course, the bigger the purchase the bigger the risk, so banks are considering limiting consumers' ability to pay by debit card.
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But a Bank of America spokesman declined to comment on whether the bank would cap debit card purchases at $50 or $100.
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If a cap like this does make its way into accounts across the board, consumers would be forced to write checks, withdraw cash from ATMs, or put their spending on credit cards. "The whole model on the debit card side is in flux because of Dodd-Frank," said Brian Riley, senior research director at financial services consulting firm TowerGroup.
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Bank of America, for example, announced a $59 annual fee last month for its riskiest customers -- making up about 5% of consumer credit card accounts.
(Excerpt) Read more at finance.yahoo.com ...
this would be deflationary because banks would have merchants cap stuff at 50.
what about forcing multiple 50 transations.
how about airline tickets?
chase is stuck on stupid or in very very very very bad shape.
The CEO of Chase was on CNBC staying how they would not accept principle forgivness in loans. He forgot to mention the faudulent valuations used.
... the bank gets the same fee ... what the bank (or others) does not get to is to control if you get credit or charge you interest
Now I know many have gone to using a debt card for their credit card.....
So here what you got coming...you make good money and have money in the bank... but the bank or government states ... "hey you fico rating sucks"(well hey the economy sucks we all took a hit and I do cash only now) ... no credit for you or very hi interest for you...
you say no problem I will use cash... then you get the business saying... we required a credit card for security... so no you can not do business with us
With a $50 cap you couldn’t use your debt card to fill your car with gas.
Really? I use my debit card all the time but just use it as debit rather than credit—good to know
Forcing everyone back to cash.
Which would make the fedgov go nuts.
Bankers are mostly liberal elites. They don’t care about anyone EXCEPT each other...
Which gets you flagged by the DEA and others.
Operating on cash generates a lot of attention, and can end with the local cops seizing it as drug money (which they don’t have to prove in court).
B of A was/is one of the chief players in giving undocumented mortgage loans to Illegal immigrants.
B of A has been an immoral entity for quite some time (I had a CC account with them several years ago - they kept changing their terms to try to squeeze more costs - even at one point trying to do a “retroactive” change that quickly got stopped.
“Playgirl” Brown is merely the metrosexual little brother of the RINO-Progressive Maine Twins...the cousin of Little Lindsay “Single at 53” Grahamnesty, the nephew of “Alligator Arms” McCain and the grandson of Richard “Hock-a” Lugar.
He is also a second cousin, once removed, to Lisa Murkowski, the never-ending Democrat agenda supporter and Sarah Palin detractor.
Scott Brown is a RINO and needs to be “primaried”
BINGO ... the banks are probably capping PIN transactions because they get a minimal cut from the merchant ... the same purchase is made as a SIGNATURE transaction the bank get a much higher piece of the action. The one's taking a hit are the merchants ... not the shoppers. That's why when you use a debit card at most merchants, it defaults to asking for a PIN.
Yet another reason why the Congress should have told Hank Paulson to go f**k himself in 2008, and let the bank collapse.
I get a lot of money back from Chase doing it this way. It’s a no-brainer. The only difference is that you sign the receipt (now only if it’s over $25 usually anyway) instead of putting in the pin.
I’d rather do it that way and not type in my pin all over the place too. There’s no downside. You also tend to get covered by fraud protection as well. ALWAYS use it as a credit card!!
Hope it doesn't happen in California. I pay cash as much as possible. Just bought something over $300 from a guy and paid him with twenties. Sometimes I use hundreds as they're easier to carry. Cash as I go and I am debt-free.
The swipe charges were legislatively reduced not based on any business realities. I can see the banks trying to limit dollar amounts to get more swipes to recover the loss from the 40+ cent swipe fee that is now 12 cents.
(Un)intended consequences of meddlesome legislation.
In the real world though they will have to set it at at least $100 and more probably $200. Fifty won’t cover even a single persons trip to the grocery store these days.
Not all Debit cards will work that way - this is why most retailers actually ASK “Debit or Credit”.
ya know, one of these days the Leftists are finally going to line up enough angry people with pitchforks and come after the banks. And by then the free market people amongst us will be too disgusted by stuff like this to come to their defense.
They'd have to start printing thousand dollar bills for that to be workable.
I wouldn’t trust a bank that wouldn’t honor my debit card any more than I’d trust a bank that wouldn’t honor my check. Next they will limit how and when you can withdraw your own money.
Open an account with a local bank. They tend to be much more interested in keeping their customers happy.
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