Not a lot of people in the UK seem to be aware of this, and to be honest neither did I until I found out about this. For this reason, I have decided to do a short article about just how using your debit card has the slight chance of making your bank account overdrawn. The point of this article is not to make you not use it, just to make you aware that it is possible, and to help you avoid any genuine bank charges.

Okay so what you probably all know is that Debit Cards provided by Banks in England to its customers are a guaranteed method of payment to the retailer who accepts the payment via the card. By this I mean, if you say go and shop in your local supermarket, and hand over your debit card as payment then the theory is…. that the little debit card machine checks with your bank via some electronic magic to ensure the funds are available to pay the amount they are requesting.

What you may not know, is that all retailers have what are known as “floor limits” this is the amount that they set the machine to check with the bank for available funds. So one retailer may set it at say £5 and another £30 or more. The amount will normally depend on the retailers normal spend per customer. Of course we as consumers will have no idea what the floor amount is when we reach the till to pay, it’s a bit of a lotto.

The slight danger is that say there isn’t enough money in the account for whatever reason to pay for the goods, but the shops floor limit is less than the amount being requested. In this case they don’t check with the bank to see if the money is there or not. They simply take the card details, you put in your pin or sign the sheet, and they are guaranteed the money from the bank. You as the consumer have said the money is there, and that you will pay by entering your pin or signing the debit card slip.

As soon as you complete the transaction the bank is duty bound to pay the retailer the money you have spent. So if the funds are not there, the bank has to pay the retailer and thus it can take your account overdrawn. At this point you then risk the bank charges, because you have acted and taken your bank account overdrawn. So the moral of this article is, be careful and make sure you know the funds are in your account before you spend it!

One good way of making sure you have lots of money in your bank account is by winning the lottery, and I think a great way of increasing your slim chances of winning the lotto is by joining an elottery syndicate. Anyway remember make sure you know how much is in your bank account when using your debit card.

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