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Study Demonstrates Popularity of Check Cards

[Sep 18, 2007.]

 

A survey by Bankrate demonstrates just how much American consumers are benefiting from debit cards.

Debit cards are more popular than ever, as consumers turn to them for their convenience and budget-management capability. The cards have also gained acceptance because they do not carry any transaction fees but do offer a number of rewards programs.

Bankrate polled the 10 biggest banks and thrifts in the top 10 markets in order to find out about their check card policies and fee structures. Of the 100 financial institutions surveyed, only 7 charged point-of-sale fees for PIN transactions. The majority of those with charges charged per transaction rather than charging on a monthly basis.

A scant 3% of the banks surveyed do not offer check cards at all. Of those that do offer debit cards, only two charged annual fees - Bank of the West in San Francisco and Firstrust Savings Bank in Philadelphia.

Meanwhile, the Federal Reserve reports that check cards have been used to make more purchases than credit cards for the past 4 years. One financial institution, Wells Fargo, charges $1 per month for signature transactions. But the fee applies no matter how many transactions a consumer logs in a month.

Why the widespread popularity of check cards? There may be a number of reasons for the phenomenon. To begin with, check cards are convenient - they're far less time-consuming than writing a check. Also, they are more secure than cash, providing a paper trail that can be critically important if you discover a defect in a product. They can also be an incredibly helpful money management tool, since they allow you to make purchases without racking up the fees and finance charges associated with conventional credit cards. Debit cards may be particularly popular among young consumers, who prefer using plastic to using paper money or writing paper checks.

Julie Ann Amos
September 19th 2007

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