Credit Cards

Abigail abigail at
Wed Oct 14 22:07:09 BST 2009

On Wed, Oct 14, 2009 at 01:10:39PM -0700, Avleen Vig wrote:
> On Tue, Oct 13, 2009 at 2:18 PM, Abigail <abigail at> wrote:
> > The problem is the protocol between the retailer and the banks. There
> > are differences in different countries. So you cannot use your
> > ATM card for retail payment outside of your country. But this
> > is going to change by the end of next year. See for instance
> >
> Almost, yes.
> There is good interchange between North America and the UK at least.
> >> So I applied for a credit card (and got it, with a credit limit 4
> >> times higher than I actually wanted) - and lo, six months later the
> >> bank re-issued my Maestro as a Visa Debit....
> >
> > There are a lot of places in .nl where I can pay with an ATM card, but
> > I cannot use a credit card. The costs for a retailer when the customer
> > pays with an ATM card is only a few cents - far less than a credit card
> > payment. Furthermore, if I pay with an ATM card, money is transferred
> > immediately.
> Indeed. This is why some retailers offer incentives for people to pay
> by ATM (Ikea offers some % off in the US), and the banks offer things
> like cash back for paying by credit :)

In .nl you see that supermarkets and other large retailer try to convince
people to pay with an ATM card (putting up signs, and even mentioning it
in radio and TV ads "pay with your ATM card, even for small amounts"), 
while small retailer do the opposite: they'll charge an extra 10 cents if
the customer uses an ATM card to pay small amounts (10 EUR is the usual
cut-off point).

There are two reasons for this. ATM transactions costs the retailer money.
The amount to be paid has been decreased over time, but it's still a couple
of cents per transaction. But banks charge money to process large amounts
of cash as well. But there's also a difference in infrastructure. Supermarkets
have ATM readers that allow customers to have their card read, and their
PIN entered before the total has been determined - all the customer needs
to do is press the OK button. A small retailer first has to ring up the total,
then send the amount to the ATM reader, and only then the customer can 
have his card scanned and enter his PIN. Supermarkets win time when an ATM
card is used, small retailers much less so.


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