Everyone’s nightmare: You’re at a restaurant with a business client or a date and your debit card is declined for no reason. No one wants it to happen to them, but it can–even if you have enough money in your account to cover the bill. If you’ve found yourself asking “why was my debit card declined,” we have some possible answers for you.
Many people who receive a “declined” response on their debit cards are the victim of a process called “blocking” (you may have also heard it referred to as having a “hold” placed on your card. For large purchases, some businesses will put a hold on a certain amount of funds in order to ensure that the money is there when they withdraw it — this commonly happens when checking into a hotel or renting a car. A hold is placed on your card for an amount equal to — or sometimes exceeding — the transaction. So even if you have money in your account, it might be spoken for. While holds can last for up to two weeks on some credit cards, they typically are only present for a few days on a debit card.
For debit card users, blocking happens most often at gas pumps, auto rentals and hotels, but can occur whenever you use your card before knowing how much you’ll be spending.
According to the Federal Trade Commission (FTC), merchants use blocking to make sure you don’t exceed your account balance before leaving a gas station or checking out of a hotel, leaving the merchant unpaid.
How to Avoid Blocking
- Use credit cards, not debit cards, for hotel bills and car rentals.
- When you’re traveling, stop at stations of major gasoline brands instead of older, rural, or off-brand stations. Newer, better-known gasoline stations process debit/credit cards faster because of updated technology.
- When you choose a credit/debit card, ask issuers how long they block accounts for transactions involving hotels, rental cars, and gasoline stations.
At Public Service Credit Union, we are unable to lift a block or hold without authorization from the company itself. The same is true for many other financial institutions. If you’ve got a hold that’s lasting longer than it should, contact the company and ask them to lift it, or to send us a signed document on their letterhead that authorizes us to cancel it.
Be aware that any blocked or held funds are unavailable to you and can cause you to overdraft your account!! This will result in extra fees and could leave you without access to your cash while you are traveling. Contact us before you travel and we may be able to help you – we are always here for you at 734-641-8400, option 2.
The next time you think your debit card was declined for no reason, think back on any recent large purchases — and remember to always notify your financial institutions if you’re going to be spending money abroad. For security reasons, many will block cards for use out of their home area, let alone in another country. Don’t be caught off guard – know before you go!