[Sigia-l] IA's Responsibility

[David (Heller) Malouf]

The way it works here in the US is like this:

If I take a Visa Check Card (i.e. a debit card that has a Visa logo on
it) I can use it anywhere they accept Visa. Most of the time this
means that the transaction gets processed as if it is a Credit Card
from the vendor's perspective and they are blind to the fact that it
is really a debit card in credit card clothing. When you process this
transaction in the US you usually (though this is changing in some
location) have to swipe the magnetic strip and then sign a credit card
receipt that the vendor holds onto as reference. (We do not have
chip/pin cards in the US, yet).

At larger establishments their card reading system also allows for
debit cards (with or without a credit card authorizer being
involved--no visa logo required. Some banks offer debit cards like
this still. When I use these cards/systems it actually costs the
vendor less money per transaction because less parties are involved in
the transaction--i.e. no Visa.

Now, B/c many many people in the US have "Visa" or "Mastercard" vetted
debit cards, this gets further complicated b/c you can choose if you
want to process your transaction as a debit card or as a credit card.
The net effect on your accounting of this transaction is nill. The
effect on the vendor is a few pennies more if you choose the credit
card processing version.

Where it hurts the end user is if the user belongs to a
rewards/loyalty program that is connected to their debit card's use.
These programs want you to use the "credit card" side of things so
they insist that you have to have a "swipe" & "signature" for the
transaction to be registered against the program.

Whew! howz dat for completely and unnecessarily complicated to no end!

I wonder how much of it I actually got right!

-- dave

On 8/30/06, Eric Reiss <elr at e-reiss.com> wrote:
> Living in Europe as I do, I'm not sure I fully understand the problem.
>
> Over here, a debit card is just that - a method to debit my bank
> account. Even if the card also has a Visa logo, it works like a debit
> card. Visa does not send a monthly statement; there is no true credit
> option and I can see my results on my bank statement.
>
> A credit card does send a monthly statement from the provider
> (American Express, MasterCard, etc.). In other words, I buy on credit
> - other people's money. Granted, I can withdraw funds using a PIN
> code and my credit card, but this is not a transaction that goes
> directly through my bank.
>
> Do you have cards in North America that give you a genuine credit /
> debit option?
>
> All my best,
> Eric
>
>
> -----------------------
> Eric Reiss
> Managing Director
> FatDUX Aps
> Copenhagen, Denmark
> http://www.fatdux.com
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>
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-- 
David (Heller) Malouf
dave.ixd at gmail.com
http://synapticburn.com/