Debit card lacks the rewards and spending power of credit card, and thus do not feature prominently in TV ads or in mail advertisements. Yet despite these shortcomings and limitations debit card are loved by millennial and anyone else who wants to avoid credit card. They are the power behind Venmo transactions and are now the preferred method for paying at the gas pump. When debit card rose to popularity in the 1990s and 2000s, banks were able to profitably benefit from rising interchange rates, and at one point commonly offered rewards on them — especially when consumers opted to sign for their transactions instead of using a PIN. Merchants baulked, and the Durbin amendment was born, slashing interchange for covered banks with assets of $10 billion or more. The result was that debit card marketing programs at big banks were wiped out, and now M&A activity for exempted banks (assets under $10 billion) is given pause should a bank exceed the asset threshold and become covered under the Federal Reserve’s Regulation II (Durbin amendment).
Image Source: businesstoday.in
According to a recent Gas Buddy survey of more than 1,600 adults, the preferred method for paying at the gas pump was found to be the debit card, with 51% of consumers picking that payment form. Despite the allure of rewards, the credit card came in second place with only 37% of consumers picking that method.
“People don’t want to rack up credit card balances for frequent purchase. In using a debit card, it makes people feel that they are more responsible,” stated Sarah McCrary, CEO at Gas Buddy. GasBuddy is acting on these findings by offering a decoupled debit card that rewards users for fuel-ups but is not tied to any particular petroleum brand. Since the product’s 2017 launch, Pay with GasBuddy has reached 600,000 enrolled members, averaging 15 -20,000 new sign-ups each month and has conducted a total payment volume (TPV) of $313 million.
Source: Payments Source
Disclaimer: Darkweblink.com does not promote or endorse claims that have been made by any parties in this article. The information provided here is for the general purpose only and unintended to promote or support purchasing and/or selling of any products and services or serve as a recommendation in the involvement of doing so. Neither Darkweblink.com nor any member is responsible directly or indirectly for any loss or damage caused or alleged to be caused by or in relation with the reliance on or usage of any content, goods or services mentioned in this article.