According to my parents, who run a music shop in Halifax, Nova Scotia, there’s a big difference between US & Canadian consumers in terms of choice of payment method. Here in Canada, debit cards are extremely popular–indeed, my mom reports that it’s begun to outstrip Visa & Mastercard at their shop. But I’m told that debit cards have never really caught on big in the US, where credit cards are still the way to go.
So I was curious if my anecdotal evidence is true, &, if so, what the reason(s?) is/are for the cultural difference. --N
From my own experience here in Kingston, ON (hanging around with all of the university students), Interac (the debit card system to us Americans) is the way to go. I’m pretty sure my account isn’t set up to work that way, so I use my charge card … which I learned from my parents.
One of my friends at home (in the US) does use a debit card, but she’s the only one I know.
I know that my bank (BankBoston, now Fleet) didn’t allow me a debit card until I was 19, whereas the creditcard company (VISA) let me get it when … oh, I don’t know, I think I was 16. Yes, my parents did cosign it. This lack of availability, combined with parental example, is why I now use a credit card instead of a debit card. (In fact, I still don’t have a debit card.) This may be true for others, as well…
Both Visa and Mastercard are offering Debit cards now; they’re beginning to catch on, but it will take a while, since us 'mericans hate change so much.
I’m a enthusiastic user of credit cards, but my wife pays them in full when the bills arrive. I also have a Visa logo’d ATM card that can be used as a debit card.
My wife, who takes care of our finances, would rather receive a bill and pay it, than have the money disappear from our account in dribs and drabs as it would if a debit card was used.
It’s also my experience that if a purchase is made on a credit card, and a problem of dissatisfaction arises, there is recourse through the card issuer. With a debit card you apparently don’t have that advantage. I have on occasion used the card issuer’s clout to obtain satisfaction with merchants.
That’s the biggest reason I use credit cards instead of debit cards. In the US there are many consumer protection laws that credit card issuers must obey. A couple are a $50 limit on consumer liability for a lost/stolen card, and the ability to dispute charges. A debit card isn’t required to have this protection (although many debit cards are voluntarily following some of them, to attract customers).
Also, my credit cards give me an additional benefit, such as cash back (Amex Platinum cash rebate, Discover Private Issue), credit towards additional purchases (Toys R Us Visa, Shell MC) or purchase protection (Amex, Visa/MC gold). In fact, if you pay off your credit card balance every month, I can’t imagine why you’d want to use anything but a CC (unless you’re a privacy fanatic, and if you were, you probably wouldn’t want to use a debit card either).
And then there’s the fraud problem. Just 2 weeks ago someone used my wife’s debit card/Visa number to purchase $600.00 worth of beauty supplies via the Net or mail. Because it’s a combination Visa/debit card no PIN was required. If we hadn’t had overdraft protection we’d have bounced 3 checks. Still, we had to pay interest on the overdraft protection money while the bank sorted things out.
The advice from our bank? Only use your debit card for purchases when your PIN is required. Otherwise use a regular credit card.
