If you are Canadian, chances are your answer is "yes". Or, even more likely, "hell, yeah!"
Canadians are among the heaviest users of debit cards in the world. As a nation, we purchased more on debit than the United States did in 2001, the last year for which I can find figures. Think about that a minute: they have more than ten times our population.
Having worked in retail for many years now, I have seen the rising use of Interac from the other side of the counter. Well over 90% of our grocery store's sales are paid for using debit cards. With numbers like that, it's not hard to imagine a cashless society, and sooner than you'd think.
I have a love-hate relationship with debit. I love the convenience. I hate just about everything else.
SERVICE CHARGES
It seems hard to believe, but there was once a time--not all that long ago, either, within my lifetime--when banks made money by prudently investing what funds we, their customers, deposited. Not only that, they returned a healthy interest rate on that money. Now, banks make money by charging us for every conceivable "service" they provide. They even charge us for NOT providing service: if your account lies idle for a month, you'll get dinged with an "account inaction fee". And interest? Unless you're rich, forget it: many banks return zero interest on balances under a thousand dollars, and as close to zero as they can on anything above that.
Is it any wonder our banks ring up billions of dollars in profits every few months?
One of the ways they ding you is through the Interac system. There are a couple of options here: you can choose to have money siphoned out of your account every time you use an ABM or make a purchase on debit. Or you can elect to pay x dollars a month for the convenience of accessing your money...but it better be through a certain machine, else you'll pay more. No matter what you do, bend over, 'cause you're gonna be cornholed.
The banks say that service fees are for system maintenance. Does anybody actually believe that? Maybe the kinds of people that answer emails from very sick Nigerian children who have won lotteries and want to share their winnings, but certainly not the rest of us. With literally billions of transactions happening every year, the cost of "maintaining the system", per transaction, just has to be negligible.
If the co-ordinated financial anal rape of Canadians by our big bad banks wasn't enough, they're in cahoots with a whole lot of retailers. I've tried to research the laws regarding retail Interac service charges with little success. It may well be there aren't any: the retailers may well be entitled to charge whatever their market will bear. Evidently their market bears quite a lot. Consider:
In Niagara Falls, arguably Canada's cheesiest tourist trap, some places charge $2.50 to let you spend money in their establishments. One place told me they didn't take debit and directed me to a little one-eyed bandit of an ABM in the corner, which tried to ding me $5.00 to withdraw $40.00. (Needless to say, that place lost my business.)
Just down the street from me, there is a Daisy Mart that has its Interac policy clearly posted: a charge of 25 cents will be assessed on any Interac purchase totalling less than $5.00. Knowing as I do that each Interac transaction costs the retailer 12 cents, I suppose I can grudgingly accept the quarter charge. But:
- milk doesn't count
- bread doesn't count
- newspapers, no matter how many you buy, don't count
- bus tickets don't count
- tobacco doesn't count
The following is a fairly educated guess: the above counts for over eighty percent of that store's sales. Pathetic, isn't it? I don't frequent that store any more--even if I have cash.
If I go well out of my way, I can patronize a Short Stop or a 7-Eleven. Neither charges for Interac use, no matter the size of the sale or what it contains. I've worked for both chains, and I used to mentally roll my eyes whenever somebody bought a Slurpee or a pack of gum on debit. (This happens far more often than you'd believe.) I wanted to charge the customer for holding up the line, but then again, the delay was our fault...we had the slowest Interac connection I've ever seen. Besides, both variety store chains understand that Interac encourages impulse spending: even with all the less-than-a-dollar purchases, the average debit transaction was much higher in value than the average cash transaction. Service charges discourage trade. They certainly discourage me.
There's one last thing about Interac that, as a consumer, I appreciate, but as a retailer, I can't stand: "cashback". I can't begin to tell you how many times people wander into our store ten minutes after we open and expect to get $200.00 cash back. They tend to get right pissy when we tell them we don't have that kind of cash on hand. Ironically enough, we don't carry much more cash at open than I did at Short Stop...at least in part because almost nobody uses cash anymore.
What I want to know is, did we turn into a bank overnight? Does it say "BANK OF PRICE CHOPPER on the sign out there?
Didn't think so.
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