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Card incentives for debit as credit cards hurt merchants
January 23, 2008
Noblesville (Ind.) Daily Times: The use of credit/debit cards for purchasing everything from gas to groceries has grown steadily in popularity. And though not all consumers use their debit cards as credit, many people do, to the chagrin of merchants who pay higher fees to process debit cards as charge transactions. Some banks offer incentives for debit as credit, while some credit card companies may even offer purchase protection on goods customers buy with debit as credit — protection they might not otherwise have with a debit card purchase, should something go wrong after the sale. Sue Roudebush of the Old Picket Fence shop in Noblesville said about 75 percent of "plastic" transactions are processed as credit, rather than debit. "If they (purchasers) run it as a charge and it's over $25 it costs less for me as a retailer," she said. "If it's a debit card and it's over $25, then it's a lot less for me — sometimes a percentage, percentage-and-a-half."
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