One swipe at gas pump may not cut it
Some stations have $50 credit card limit
By Michael Stetz
STAFF WRITER - San Diego Union Tribune
May 30, 2006
Need a fill-up?
Like many, you might just swipe your credit or debit card at the pump. After all, with gas prices going through the roof, who carries around that kind of cash besides, maybe, Tony Soprano?
But even plastic has its problems.
Now, if you use a debit or credit card, you might get cut off when you reach a certain amount – in some cases as little as $50 – regardless of how flush you are.
If you want more gas, you have to swipe the card again.
If you're filling up a motor home, it could take a few transactions.
If you don't realize this little quirk, you could pull away from the pumps with your car – or more likely an SUV or truck – not completely filled.
This wasn't an issue a few years ago, when gas was more affordable. But prices are now at a record high.
And $50 just won't cut it in some cases.
“People get angry,” said Dave Whitlow, who owns Spirit Auto Center in Lakeside, where there is a $50 limit on debit transactions.
“Fifty dollars – that barely fills up an economy car.”
It's a bank, credit card and a gasoline industry thing. And it's more than a little confusing.
Buying gas with a credit or debit card is not like buying groceries with your plastic. When it comes to gas, you're swiping the card before the actual purchase.
So it's an unknown how much you're going to spend.
A limit is placed on the purchase, to protect the merchant and credit card company from being hosed. In the not-so-recent past, $50 seemed like a reasonable limit because that could fill up most tanks.
The figure is important for two reasons. First of all, you can't use your card if you don't have at least that much money in your account. Even if you only want $20 worth of gas, you got to have at least $50 in the bank or available in credit.
So the limit can't be too high – or else consumers will be disapproved. And, of course, put off.
Second, the bank puts what is called a “hold” on the full amount until the transaction is actually completed. The banks don't want you to drain your account before it gets the money for the gas.
And that takes about a day or so. It doesn't matter if you got only $10 worth of gas. You're hold is for the full $50. That means you can't touch the other $40 until the transaction clears.
Because of the increase in gas prices, the pre-authorized amount may now be too low in some cases, said Tracey Mills, a spokeswoman for the American Banking Association, which represents, in addition to banks, credit card companies.
But it's a tricky thing. As said, if the figure goes up dramatically, people could be priced out of using their cards. And the resulting larger holds could tie up people's accounts more dramatically.
People used to complain that the $50 hold was too high, Mills said.
“They tried to make a system so that both merchants and consumers are happy, and now everybody's complaining,” she said.
Gas station operators are upset because they get grief. Some consumers can't get a tankful of gas without hassle.
“It's kind of a pain,” said Rob Brownlow, who manages Bundy Trucking, which has a fleet of 17 trucks. Each one holds about 200 gallons.
When his truckers started getting cut off, they found a solution at one particular station. They could fill up without worry as long as they first took the credit card inside to the station attendant.
The debit and credit card system is hardly consistent. Some credit card companies and gas providers are upping their limits; others are not. All apparently have at least some limit.
At OB Gas, for instance, the pre-authorized amount for most purchases is $75, said owner Paul Garby.
His station, which is independently owned, sets it, he said. It used to be $50, but that was too low. He hasn't received complaints since it was increased.
Exxon Mobil sets its own limits by working with credit card companies, said Rebecca Chen, a spokeswoman. The limits were increased last November, she said. On debit cards, it went from $50 to $75. On credit cards, the limit was $75. Now it's $100.
Valero still has a limit of $50 for debit card transactions and $75 for credit card swipes at its company-operated gas stations. It also encourages its independent dealers to follow suit.
But the company is now looking at a possible increase in California. It could be bumped up to $60.
Because . . .
Big surprise: Gas doesn't seem to be getting any cheaper.