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Why do gas pumps cut off at $50.00??

Discussion in 'Off Topic Threads' started by blkcloud, Jun 14, 2010.

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  1. blkcloud

    blkcloud Active Member

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    This really chaps my rear... I'd like to see a vehcile you can fill up for $50.. I guess I'm missing something in the thinking.. I know in my business the more I sell the happier I am.. so why do the gas stations make you swipe your debit card twice just to fill up your car>>!!??
     
  2. Captain Bud

    Captain Bud TS Member

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    go to the counter and ask the attendent "If I give you my credit card will I be able to fill my auto with more than $50.00 worth of fuel?"

    The answer is usually "yes".

    I was told that it has to do with the creditcard co. and stolen cards.

    Phil

    I can take on 100 gallons in my pickup so when I'm low on fuel, I go inside.
     
  3. JRW

    JRW Member

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    I do not think it is the gas station. The credit cards a probably debit card company are calling the shots. They do not want to ok a purchase then you go over the limit of credit or you go over the amount left on debit card. Just my opinion. Jerry in MI.
     
  4. Ajax

    Ajax Well-Known Member

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    Most of the procedure has to do with the Banks and the Oil companies the dealers do business with. Not with the local dealers themselves. Most of the time there hands are tied and they don't like it either. Some dealers in my area have now been able to move the cut off to $75.

    Another thing you might want to know, if you are using a debit card. Some banks put a hold on a higher amount than the purchase for a few days. Most are $50 dollars. So that way the bank can charge you for a over draw if you don't have enough to cover the amount in your account. If you can go on line and check you account. After using your debit card, see what your account balance is and whats "available". Some restaurants do the same thing.


    Ajax
     
  5. Leo

    Leo Well-Known Member

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    The cut off has to do with the way the credit card companies charge the retailer.
     
  6. AveragEd

    AveragEd Well-Known Member

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    I asked my bank about that once and was told that as long as there is $1.00 in your account when a merchant swipes your debit card, the sale is approved. There is a maximum that some merchants want to gamble on there being more than $1.00 in your account at one time, so many of them set a limit of $50 per sale.

    Ed
     
  7. notarget

    notarget TS Member

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    Avoid debit cards. Find a local community bank that issues its own credit card and there should be no problem.
     
  8. Catpower

    Catpower Molon Labe TS Supporters

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    It's what they call their "floor plan" at least that's what they used to call it, if the tranaction goes over $50 the charge has to be approved, to do it automatically the bank charges the vender more so alot of them stop at $50, but there are some who are increasing it
     
  9. Joe Potosky

    Joe Potosky Well-Known Member

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    More then you may want to know....

    Gas buyers fume at credit, debit card limits, 'blocks'

    High prices, issuer practices run consumers afoul of rules

    - CreditCards.com -

    Consumers already frustrated by the high price of gas may also be hit with a couple of nasty surprises at the pump: Their credit cards may turn stingy, imposing limits that leave unfilled tanks, or they may get greedy, "blocking off" more of your credit or debit card limit than needed for a fill-up.

    Jeff Lenard, spokesman for the National Association of Convenience Stores, sympathizes. Of the group's 145,000 stores, 80 percent sell gas. "Consumers are already pretty ticked off" over gas prices, he says. "Then they get hit with one or both of these things."

    "These things" are:
    Credit or debit limits too small for a fill-up
    For years, thieves have tested stolen cards at gas stations because they may remain anonymous by paying at the pump. To combat that fraud, stations have imposed limits of $50 to $75. When gas prices were lower, that was no problem. Today's high gas prices cause law-abiding consumers to be cut off in midpump.

    'Blocking off' more than needed
    Card issuers' policies allow merchants to temporarily lay claim to -- "block off" -- a larger-than-needed chunk of consumers' credit limits or debit card balance when the final purchase price is uncertain at the time credit is authorized.

    Holding patterns
    "Blocks" or "holds" assure merchants -- not just gas stations -- they'll get paid in full in cases when a transaction is authorized before a final amount is owed. It doesn't just happen at the pump. For example, the practice lets a restaurateur accommodate an extra-generous tipper or secures a hotelier against guests suddenly infatuated with the minibar. It applies at gas stations too, because the station doesn't know how much will be pumped when it OKs a sale by credit or debit card.

    "If you're running low on funds and only want to pump $20 of gas, your account could be dinged $75, and then a cascade of fees could start," says Lenard. "Guess who benefits from that? Not the convenience store."

    At gas stations, the hold should only last a few moments -- until the final real amount is processed -- but for signature debit transactions, this may take up to three days. Gas stations have even received complaints from customers when the bank has held the money for a week, Lenard says. "When you look at the electronic statement, it looks like the gas station is holding your money. If you pay by PIN debit, that hold should be done instantly. If it takes significantly longer, someone is messing with your money."

    Why are holds allowed? Jay Hopkins, a spokesman for Visa, says they're needed when cardholders use their cards "in places where the exact amount of a transaction may not be known when the merchant first requests an authorization for a purchase. This feature enables cardholders to take advantage of such services as express or video checkout at hotels, pay-at-the-pump fueling and one-swipe payment at restaurants."

    Hopkins also says the payment network has rules set up to prevent consumers from being too far down and out: "To help ensure that holds do not disrupt cardholder access to the funds in their accounts, Visa requires that card issuing financial institutions release all holds within three business days of the authorization request or when the transaction clears, whichever is earlier," he says.

    Where consumers can be hurt, though, is that rules are unclear about how much can be blocked off, and how soon the unused portion of credit is "returned" to a consumer. The "blocks" can push consumers over credit or debit card limits, forcing them to pay fees.

    Blocks, limits vary
    Each card has its own rules on limits. Corporate credit cards typically have higher limits than personal cards, and fleet cards, used by corporations and other groups managing multiple vehicles, can go as high as $150, a limit that will probably not be questioned until gas prices double again. Discover, however, specifically limits gas pump purchases to $50.

    The limit system, notes Jordan, protects merchants from fraud, which lowers the cost for consumers. Merchants may opt out of the system by signing on to programs such as "Verified by Visa," in which consumers set up passwords for their cards. Merchants pay more for the program.

    Card issuers, retailers spar
    Retailers and credit card issuers, already locked in a battle over interchange fees paid by merchants to process credit card payments, differ over who is to blame. Retailers say the pump limits and hold times are another way that issuers are controlling the system to the disadvantage of store owners and customers. Issuers and payment networks disagree.

    With pump limits, for example, "There is no policy that limits transactions at the pump from MasterCard," says MasterCard spokesman Tristan Jordan. "The merchants themselves make the decision."

    While that's true, the card processors heavily influence the merchants through their policies. Most credit card companies say that the merchants opt to put the pump limit at exactly the "charge-back" limit -- the highest amount the credit card company will pay a merchant if the transaction turns out to be fraudulent. In other words, they claim merchants cut off customers at the amount the bank will pay if the customer doesn't pay the bill. Visa and MasterCard set their limits at $75 (Visa raised its limit from $50 in April 2008).

    Hopkins says it is usually the issuing banks that place holds. "Visa does not issue cards, and thus, it does not place 'holds' on cardholder funds," he says. "The financial institutions that issue Visa cards decide whether to place holds on cardholder funds. Some card-issuing financial institutions, in order to protect themselves against the risk that cardholders will spend more money than they have in their accounts, place a 'hold' on funds in anticipation of the final transaction amount."

    Hopkins also says debit cards and credit cards work similarly with holds because the mechanics and purpose are the same. With debit, the point is to ensure you don't spend more than you have in your account; with credit, it's to ensure you don't go above your spending limit.

    What consumers can do about limits
    Consumers standing at the pump have two ways around the problem.

    1. Start a second transaction. The limit system is designed to cut fraudulent charges, but it's a ham-fisted tool. The limit is per transaction. You can just start pumping again in a new transaction. Starting a new transaction is an annoyance for customers, but it can become a burden for retailers that pay a per-transaction fee.

    2. Go into the store to pay, where the limit is likely higher because it will be a face-to-face transaction.

    What consumers can do about blocks
    Some gas station owners have tried to find a way around the system by lowering the per-gallon price for purchases made with cash, which may be the only way consumers can benefit from using cash over plastic.

    The Visa and MasterCard standard agreements with merchants, in a flourish of semantics, forbid credit card "surcharges," but allow cash payment "discounts."

    Because holds and blocks are generally initiated by the issuer and not all issuers use holds and blocks, you should call your credit or debit card issuer to find out their policies.


    http://www.creditcards.com/credit-card-news/buyers-fume-at-gas-credit-cards-1267.php
     
  10. oz

    oz Active Member

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    I don't have that problem. I am always over $50. when gas was $4 and change I was at $100 without a problem. whine about the important things .
     
  11. ivanhoe

    ivanhoe Well-Known Member

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    Interesting thread but I wonder. Recently with a friend in his diesel pickup at a truck stop the big rig next to us at the pumps had $400 dollars on the pump and climbing.

    Bob Lawless
     
  12. Bisi

    Bisi TS Member

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    The station at the corner pumps kick off at $48. I used to buy all my gas there until it was at $4 a gallon. The next station is only an 1/8 mile farther and their pumps go to $100 before they kick off. I just started buying gas there.

    Heck when gas was $4 I had to go to both stations to fill up the one pickup with dual tanks. I would hit the one station where the pump would quit at $48, they drive down the street to the one that wouldn't kick off until it got to $100. That is the only way I could fill both tanks.

    $4 gas, I think that is what kicked the recession in high gear.
     
  13. dhip

    dhip Active Member

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    I found that it depends where you buy your fuel also.Some $50,some $75,and as stated,depends how paranoid the credit card company is at the time.NOW,for those who use debit cards,a friend was told by a person at the bank he uses if you want to avoid any debit charge when you use your debit card,all you have to do is press credit instead of debit when asked at the pump,bank person told him it still works as usual but NO debit charge.Haven't tried it yet myself,but he said he has and it works.

    Doug H.
     
  14. Brian in Oregon

    Brian in Oregon Well-Known Member

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    I had no clue this was happening, as I've not run into it yet in Oregon. Good to know if this turns up on out of state road trips or gas stations that I normally don't use. Thanks for the info.
     
  15. letts

    letts TS Member

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    If our any of our local stations did shut the pump off at $50.00 I would say if thats all they want to sell me, thats fine. Of course I would be sure and not return to that station as the ones I do use do not cut off at $50.00 maybe $75.00 but I do not usealy need that much at present prices. I have a Holiday station card and do not think they stop the pump at any amount, at least they have not for me. and the discount I receive for using their card is nice also and they have the best coffee in the area.


    Letts
     
  16. Ajax

    Ajax Well-Known Member

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    When the pump stops, all you have to do is insert the card and go through the procedure again. I've never had to move to another station or even a different pump. It usually takes two swipes for the motorhome but sometimes three. On the third swipe sometimes I had to go in and show them some ID.

    Brian it happens in Oregon, you just have not run into the situation yet. Some of the places I was checked on the third swipe was in the Bend and Medford areas.

    Ajax
     
  17. J.Woolsey

    J.Woolsey Member

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    I've not had it happen yet. I'm in NC, often travel to Indiana. I usually use my Shell card. J.W.
     
  18. mixer

    mixer Well-Known Member

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    A friend with a motorcycle told me the story about his being on a long trip and covering 700 miles a day denied use of his debit card for gas because the bank thought that 5 gas charges for 5 gallons every two hours or so in one day was suspicious. When he explained to the bank that he gets about 150 miles per tankful they said he should call them before hand so they would not block the card.

    Eric
     
  19. spitter

    spitter Well-Known Member TS Supporters

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    Debit cards are not credit cards... but recently I had the pleasure of being "taken" for $1800 in gas in Georgia and South Carolina over a couple days at "self-pay" pumps - BOA cleared me of all charges, but a dozen seperate merchants are on the hook for 100s each...

    They're a convenience, but a rat-hole for purveyors... I check every signature when presented with plastic at my store and ask for ID in any questionable tx... time to go back...

    regards all,

    Jay
     
  20. Auctioneer

    Auctioneer Well-Known Member

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    I wonder what would happen if you got $100.00 or more of gas. The numbers only go up to $99.99
     
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