Clark Howard's Tips

Never use a debit card to pay at the pump

April 5, 2005

Have you ever used a debit card at a gas station to "pay at the pump?"

Say you fill up $20 or $30 worth. Then, two days later you get a notice from your bank that you've bounced some checks.

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How can that be, you're probably thinking.

But, what you may not know is that when you use a debit card, gas stations have the right to overcharge you a certain amount to ensure they get their money. Sometimes it's only a $5 or $10 hold. But it's up to each gas station to decide how much to hold in your account, and some put a $75 or $100 hold on the account.

And, they also decide how long to hold that money. Some hold the money for up to three days, so that can really hurt you.

If you want to use a debit card at a gas station, do not pay at the pump. Pay inside the station and you'll be charged for only what was purchased. Or, the better alternative is to use a credit card. If you have a rewards card, you get the cash back or gas reward to boot.

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