[sigstoat]

you can overdraft debit cards, and of the college students i've known over the years, that's the most common thing to overdraft.

and then find out about your overdraft (and the 17 following it) a week later when you get a letter in the mail.

[flukus]

> you can overdraft debit cards

Not always, my debit cards have always had the overdraft facility turned off. If there's no money in the account then the transaction doesn't go through.

[rdl]

It's possible to overdraft a debit card even if overdraft is not enabled on the account, due to how some merchants process some transactions.

[flukus]

That's a cost that should be worn by the merchant, if they aren't going to check that money is available in the account then that's their problem.

Is their anywhere else in the western world that has these problems? Or even the developing world?

[snuxoll]

The biggest places you used to see this were gas stations, they'd put a $10 hold on your account and then post the transaction for whatever you actually purchased - this two-phase process also exists at restaurants for tips.

The gas station issue has been mostly solved, debit networks now allow you to query the available balance on the linked account - I've been embarrassed once a few years ago when the pump only allowed me to put a couple dollars worth of gas in the tank because I had overdraft protection turned off (not an issue these days, I'm in much better financial health).

The issue with restaurants will eventually be solved when they are forced to switch to EMV and require you to put the tip in before the card is run, not writing it on the receipt. But who knows when they'll be forced to, the liability shift obviously hasn't bothered them much.

[toomuchtodo]

Unsure why this is so downvoted? Several banks support turning off the overdraft feature, which just causes debit transactions to be declined (or ACH items returned).

[aianus]

What about NSF fees? The NSF fee at my bank is 8x more than the overdraft fee ($40 vs $5 + 20% APR). Turning overdraft off would be a poor choice for me even if I anticipated the occasional overdraft.

[twblalock]

The problem is that those features don't always work if multiple pending transactions have been submitted, or if checks are used, transactions ordered a certain way (some banks have been in trouble for doing this in the past), etc.