May 11, 2010
Credit cards and debit cards have a lot of similarities on the face of them. They look almost identical, both being on identically sized pieces of plastic. Debit cards are processed by the two largest credit card companies, VISA and MasterCard. They are both offered mainly by banks. However the cards are actually quite different. read more…
January 3, 2010
Rewards for using debit cards are a relatively new area, but many major banks are pushing this idea.
Debit reward cards essentially work from intercharge fees, which are the fees that debit and credit cards charge merchants for processing their payments. To get the intercharge fees charged it is necessary to swipe and sign for the card rather than use a pin number. This means that pin number transactions can get lower rewards, and sometimes no rewards at all, compared to transactions that need to be signed for. read more…
December 17, 2009
Debit cards are a growing segment of the payment market. There are two types of debit cards, bank cards that are part of a checking account and charge cards that are offered by providers such as American Express and Diners Club.
Debit cards work on a different model to credit cards. With a credit card there is a balance that builds up that is separate from the bank balance. This can be paid off in full every month or carried over. The debit card does not allow for a balance to be carried over. Either it is charged straight to the checking account or if it is a charge card the balance has to be paid off every month. read more…
December 2, 2009
Debit cards have a reputation for being more straightforward than credit cards. As a debit card user is only spending on his or her own account then there are no high interest rates to worry about, and there are fewer surprise fees. While all this is largely true, debit cards do carry a certain amount of fees.
One way in which debit cards carry fees is through the amount which they charge to a shop or service provider for processing the transaction, what is known as a “merchant’s fee”. The market leading debit card, American Express, has some of the highest merchant fees among all payment cards, whether debit or credit. This is what pays for the large amount of member benefits which the American Express card has. This can lead to a number of disadvantages for the card user, from a reduced number of outlets that accept American Express, a refusal to allow American Express cards the same sales terms as other credit cards or an explicit surcharge in purchases that use American Express. read more…