Credit Card Addict » Debit Cards http://www.creditaddict.com feeding your credit card addiction... Mon, 26 Sep 2011 17:03:25 +0000 http://wordpress.org/?v=abc en hourly 1 IKEA 3% Discount for Using a Debit Card http://www.creditaddict.com/archives/ikea-3-discount-for-using-a-debit-card/ http://creditaddict.com/archives/ikea-3-discount-for-using-a-debit-card/#comments Fri, 27 Feb 2009 11:00:19 +0000 admin http://www.creditaddict.com/?p=503 This is an interesting development… IKEA is offering a 3% discount (in the form of a voucher at the bottom of your receipt) if you pay with your debit card. Apparently they’ve been doing this for awhile, though I didn’t notice it until just recently. This is presumably their way of keeping a lid on credit card processing fees.

Of course, this is only a good deal if your savings are greater than the rewards that you would’ve earned by using your credit card. On top of that, you have to factor in the likelihood that you will lose or forget about the voucher before using it.

Here’s the scoop straight from IKEA:

Get 3% back on debit card purchases! When you pay with your Debit card, you can receive a discount voucher for 3% off future debit card purchases.

It doesn’t specify, but I’m guessing that it has to be a PIN-based transaction, because otherwise it will still use the Visa or MasterCard processing network.

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]]> http://www.creditaddict.com/archives/ikea-3-discount-for-using-a-debit-card/feed/ 0 Borrowing on the Decline, Consumers Turning Away from Credit Cards? http://www.creditaddict.com/archives/borrowing-on-the-decline-consumers-turning-away-from-credit-cards/ http://creditaddict.com/archives/borrowing-on-the-decline-consumers-turning-away-from-credit-cards/#comments Fri, 10 Oct 2008 12:58:39 +0000 admin http://www.creditaddict.com/archives/borrowing-on-the-decline-consumers-turning-away-from-credit-cards/ According to a recent report, consumer borrowing fell in August for the first time in more than ten years. While this decrease was predominantly driven by changes in non-revolving debt, stores such as Kohl’s (KSS), Target (TGT), and Lowe’s (LOW) are reporting that shoppers are increasingly turning away from credit cards and opting for debit cards or cash. Not surprisingly, this decline in credit usage is hurting sales performance.

For their part, MasterCard (MA) and Visa (V) have both reported a significant increase in debit card usage. At the same time, analysts are cutting their expectations for both companies, as a decline in overall spending will reduce transaction fees generated every time someone swipes their card.

I can’t speak for anyone else, but our spending habits have remained relatively unchanged despite all the recent economic turmoil. Of course, we’ve always kept our spending more or less in check, so there’s not a lot to change. Aside from that, our credit limits haven’t been changed (and we never get anywhere near them)

Source: CNN.com, FTD.de, and Forbes.com

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]]> http://www.creditaddict.com/archives/borrowing-on-the-decline-consumers-turning-away-from-credit-cards/feed/ 2 Frozen Credit and Using Debit Cards to Rent a Car http://www.creditaddict.com/archives/frozen-credit-and-using-debit-cards-to-rent-a-car/ http://creditaddict.com/archives/frozen-credit-and-using-debit-cards-to-rent-a-car/#comments Sun, 27 Jul 2008 20:55:21 +0000 admin http://www.creditaddict.com/?p=124 I written elsewhere about how and why to freeze your credit record, and I’ve also written about the ins and outs of renting a car. I was thus intrigued when I saw a blurb in a recent issue of Kiplinger’s Personal Finance Magazine about renting a car with frozen credit.

A reader had written in asking if it was possible to rent a car while your credit record is frozen, as he had heard of rental agencies running a credit check before allowing you to rent a car. The answer is a qualified “Yes.” If you rent with a credit card, the rental agency will simply place a hold on your credit limit to assure that it gets paid, and to protect against getting stuck with the bill for overages or damages. No credit check necessary.

That being said, you may be out of luck if you want to rent a card with a debit card. The reason for this is that at least three major rental firms (Hertz, Avis, and Budget) will check your credit at the counter if you present a debit card at check-in. If they can’t access your credit record, you can’t rent a car. While you can thaw your credit, that takes up to three business days and costs upwards of $10 per bureau.

The good news is that Enterprise may let you present other documentation, such as a utility bill or pay stub to prove your credit worthiness. Note, however, the use of the word “may,” and call ahead. Also, Hertz and Avis offer cash identification cardsthat allow you to pay for your car with cash, traveler’s checks or a money order. Unfortunately, you have to apply for the card up to six weeks in advance, and you may have to pay an application fee.

Of course, this can all be avoided by simply using a credit card.

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]]> http://www.creditaddict.com/archives/frozen-credit-and-using-debit-cards-to-rent-a-car/feed/ 2 Renting a Car With a Debit Card http://www.creditaddict.com/archives/renting-a-car-with-a-debit-card/ http://creditaddict.com/archives/renting-a-car-with-a-debit-card/#comments Thu, 17 Jul 2008 20:05:30 +0000 admin http://www.creditaddict.com/?p=120 I just ran across an interesting article on renting a car with a debit card over at Blueprint for Financial Prosperity. In it, Jim provided a rundown of the debit card policies of the major car rental agencies.

The short answer is that it’s definitely possible to rent a car with a debit card. However, certain agencies won’t allow it for drivers under age 25, and pretty much all of them will place an additional hold on funds in your bank account. The bad news is that these holds can last for up to two weeks (though it’s often less), during which time you can’t access a sizable chunk of your own money.

The best advice here is to use a credit card that offers car rental insurance.

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]]> http://www.creditaddict.com/archives/renting-a-car-with-a-debit-card/feed/ 0 Do You Spend More With Credit Cards? http://www.creditaddict.com/archives/do-you-spend-more-with-credit-cards/ http://creditaddict.com/archives/do-you-spend-more-with-credit-cards/#comments Wed, 02 Apr 2008 18:42:41 +0000 admin http://www.creditaddict.com/archives/do-you-spend-more-with-credit-cards/ I’m sure that you’ve heard the statistics before… People who use credit cards spend more than those who use cash. The argument is that cash helps you to see and feel the money leaving your pocket, and thus it helps you reign in your spending.

While this makes perfect sense on the surface, where are the data to actually back this up? Debt reduction guru Dave Ramsey claims that people spend 12-18% more with credit cards than with cash, but doesn’t provide any data to back it up. There is also an oft-cited study by Dun & Bradstreet that makes similar claims, though I haven’t been able to locate it. The trouble here is that people citing this study variably claim a 10%, 15%, 12-18%, or even 64% (!!!) difference.

So what’s the truth?

I honestly have no idea. I’ve looked fairly extensively, and I still haven’t been able to find data to back up the various claims. That being said, my personal experience runs counter to the prevailing wisdom that credit cards = higher spending. Sure, if I was out and about without credit cards and didn’t have any cash in my pocket, I wouldn’t be able to spend anything.

But when I do have cash, I tend to be pretty free and easy with it. And if I wasn’t carrying credit cards, I’d be all the more likely to have cash in my pocket. Moreover, with the advent of debit cards, many consumers still don’t get that feeling of cash leaving their hands even if they avoid credit cards.

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]]> http://www.creditaddict.com/archives/do-you-spend-more-with-credit-cards/feed/ 2 MasterCard: More Debit Than Credit Transactions http://www.creditaddict.com/archives/mastercard-more-debit-than-credit-transactions/ http://creditaddict.com/archives/mastercard-more-debit-than-credit-transactions/#comments Fri, 01 Feb 2008 11:18:15 +0000 admin http://www.creditaddict.com/archives/mastercard-more-debit-than-credit-transactions/ This is an interesting bit of news… MasterCard recently revealed that debit card transactions now outnumber credit card transactions in their network. Despite their many drawbacks, it thus appears that debit cards are really starting to catch on.

Source: Bloomberg.com

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