No Credit Card, No Service?

Q: What do you think about companies that refuse to accept check cards, cash, or personal checks as payment? I feel this is discriminatory. We all know that credit is not available to everyone, and not always for reasons in the user’s control.
–S. Davis, Cleveland

A: Although I understand your discontent, I wouldn’t cry foul just yet. One reason some companies, such as rental car agencies, require a credit card is because it’s a measure of the consumer’s creditworthiness to the lender. In other words, these merchants can use your card for assurance in case anything happens to their merchandise (e.g., if you get into an auto accident and the damage is not fully covered by insurance).

Debit cards, on the other hand, are issued by banks and typically have the MasterCard or Visa logo on them. However, money is taken from the user’s account immediately and there may or may not be additional funds available. “When a credit card is used, a merchant has the added security of a third-party payment system. This means that the merchant will receive payment from the bank that issued the credit card. The responsibility of actually collecting money from the customer will then fall to the bank,” according to ConsumerAlert.org (www.consumeralert.org).

See if the merchant allows other forms of payment besides credit cards. It may mean a prepayment or documentation such as employment verification, but it might be worth it.

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