If you routinely use your debit card at the gas pump, you might be putting your available funds on hold in your bank account for a few days.
The truth is that many of you might get forced into using cash or debit cards at the pump.
The increasing costs of gas are costing gas station owners a lot more money these days to take credit cards.
The higher the purchase, the more they have to pay the credit card issuer for the transaction.
Therefore, many gas stations are adopting a cash or debit policy.
Here's a catch you may not know about: When you swipe your debit card at the pump, you might have up to $90 on hold in your bank account as well as the cost of the actual purchase.
If you have limited funds, you could be in trouble.
Your purchase could be denied, or you could be charged excessive fees if you don't have enough money in your bank account to cover the hold.
Here's how it works.
If you prepay with a debit card before you pump, you'll be charged only what you pay for.
In other words, if you pay the attendant and use your pin number during the transaction, that's exactly what you'll be charged.
However, if you use your card at the pump, you could have a hold placed on your card until the actual charge clears.
Because there's no way to know in advance how much gas you'll put in your tank, the vendor places this hold to ensure payment.
Since many vendors process their debit card payments in batches, you'll have to wait until your payment clears before the bank drops the hold.
.
.
sometimes a few days later.
The good news is that most stations still place a $1 hold to verify customer accounts.
If you want to avoid headaches, use the envelope system to pay for gas.
Withdraw your weekly amount ahead of time, and you won't have to worry about large freezes on your funds.