Hi all, I would like to apply to my bank for a switch debit card but was told that i need to be credit scored before decision is made on whether to issue me with a debit card or not. I was just wondering why do i need to be scored? as the debit card takes the amount directly from my current account. I had no problems getting a cheque book from them atall.
Any insight into this will be appreciated :)
In message , blackwolf28 writes
Not all debit card transactions are 'on line' and it is possible to create an unauthorised overdraft on the account with a debit card.
Cheques can be bounced.
Most Bank's debit cards are also cheque guarantee cards - which gives you the capacity to force an overdrawn balance. Similarly, full debit cards CAN permit offline authority to be made below certain referral limits (set by retailers) which again, can force an overdrawn balance.
So yes, you need to be scored.
MC
But surely if these referral limits are at the discretion of retailers, do *they* not carry the risk associated with not bothering to check on line whether the transaction would be declined? Can't debit card transactions in such circumstances be bounced by the bank every bit as much as cheques can?
i wonder if applying for a debit card would meet a credit score to match that of a credit card?
In a word NO. That is the whole point of visa and mastercard (and others like amex etc), provided the retailers carry out the correct procedures according to their terms and conditions issued by their bankers they are a guaranteed payment. If they were not then there is not much point having them and we might as well go back to cheque and cheque guarantee limits of 50. If the retailer does not carry out the correct procedures then it can be charged back to them.
Eric
"Eric Jones" wrote
Surely those procedures *don't* give full discretion to the retailer for the setting of the floor limit? If they do, then why don't all the retailers set the limit at 10million - to save unnecessary checks??!
At 10:19:22 on 04/10/2005, Ronald Raygun delighted uk.finance by announcing:
No. Because you sign an agreement with your card issuer (after having been credit scored and accepted) that you will be responsible for such an eventuality.
Oh, and the floor limits are at the discretion of the merchant's acquirer, not solely the merchant.
"Eric Jones" wrote
Exactly! - The limits are *NOT* "at the discretion of the retailer".
I think you would find that applications for full current accounts ,with a switch/maestro or visa debit/delta card rather than just a solo/electon card, require a higher credit score than most credit cards.
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