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Buying Gas with a Debit Card? Watch Out! by Luke Buying gas with a debit card might seem convenient, but it could lead to higher prices at the pump. Some gas buyers are surprised to learn that when they use their debit card at the gas pump, the price they pay at the pump isn’t the price on the gas meter. Since the gas station doesn’t know how much you’ll be spending before you start pumping, some gas stations ask banks to automatically reserve a set amount of cash to assure you have enough money in your account to cover your purchase. This amount used to be relatively low, but as gas prices have increased, so has the amount that gas stations ask banks to set aside before allowing you to start pumping. Today, the amount can even be as high as $100. Your account will eventually be credited the difference, but the refund can take days. If this ends up causing you to bounce a check in the meantime, you could end up paying some heavy fees. As always, if your bank charges fees for making debit card purchases with a PIN, extra fees could be added here as well. One of the best way to save money at the pump is to apply for a gas rebate credit card. Not only are credit cards not assessed extra fees at the pump, but several gas stations will give rebates of up to 6% for purchasing gas.
6 Comments to "Buying Gas with a Debit Card? Watch Out!"
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July 12, 2006 
Not long after we made this post, KTSM-TV reported a story about a consumer who suffered exactly the same problems. http://www.travelfinances.com/blog/index.php/2006/07/12/debit-card-dan gers/
Thanks for the valuable info.
They should DEFINITELY post signs warning that they charge more than the amount listed on the pump! I’d never heard of this before. Next time I get gas I am going to ask if my stationg charges me more than what they say when I am there.
Who cares. The risk is overrated. People should be keeping more than 100 in their debit card account anyway. I won’t worry.
Gas stations are not the only places that will do this. Some resturaunts will add 20% for a tip and only refund it later. Hotels hold money sometimes too. If you really don’t care this will come back to haunt you. Or maybe you just have money to burn.
Use your debit card as credit. When asked by a merchant or a gas station pump - debit or credit? - respond with credit. It is still taken directly out of your checking account. So unless you want cash back - “credit” with your debit card! Always try to reconcile your account so you do not incur overdraft or ISF fees. A lot of financial institutions these days have free or low fee online banking - which allows you to check your account balances as often as you like in a day!