I was advised by a policewoman to only pay for gas with cash, she wouldnt tell me why, any thoughts?

Cash price is cheaper than credit price in some areas.

Last year I swiped my debit card at a gas station and minutes later it was fraudulently charged for nearly $700 at a supermarket in the same locale as that particular gas station. I don’t ever shop around that area. I just bought gas out there that one and last time. I contacted my bank and they reimbursed me for it but the questions still remains…

How many people does $700 worth of groceries feed?

@Deepness depends on how many children there are. and their ages.

two teenage boys could eat $700 of food in about a week (or less)

Probably just her personal belief. I’m sure she’s seen credit card theft and how quickly people can run up charges and how identity theft can really screw a person over. But what she sees all the time is not necessarily reflective of the actual risks involved or the severity of the consequences. CC companies are limited by law from making you pay more than $50 out of pocket for unauthorized purchases and I have yet to hear of one which actually ever collected that $50…customer satisfaction is worth more than $50. A female police officer might also tell you not to do a number of things which carry no realistic risk to you, but which she has seen go bad for some people. Personally, I believe if you can get one, you should get a card that gives you rewards for buying gas, saves you money.

Out here, we have some stations that only accept cash, and some other stations that are a few cents cheaper if you opt to pay cash instead of credit.

Also, less chance of accidentally leaving your card behind, if it stays properly inside of your wallet.

@Deepness At least you weren’t charged more than 2000 times the US national debt.

yeh card fraud…for some reason its more prevalent at gas stations than anywhere else

One, card fraud. Two, sometimes using a credit card means they put a preapproval charge for a large amount on it to make sure you have the funds, and this can cause problems.

That said, I always use my credit card at the pump cause all of our pumps here in Canada are pay-at-the-pump style, though you can pay in the store if you want to.

@dynamicduo I just got back from two weeks in Canada, and that was something I thought was pretty great. England hasn’t caught up in that regard.

I thought everywhere had pay at the pump.

If she wouldn’t tell you why, she was probably just pulling your leg.

shoot her!!!!

My bet it is the fraud thing. More people than you think get caught on this one. There was a rash of debit card fraud because somebody figured out how to record numbers from gas pumps. They will use the captured number for a few hundred dollars and maybe it gets detected and maybe not but if the merchant hasn;t done anything wrong then the card holder is stuck.

The gas station I use asks for the home zip code not the pin number or back of the card security number. When my card number was used for a $500 purchase without either of those numbers, the money was back in my account in less than 24 hours. I’m sure it caused several people no end of trouble. Like the $700 in groceries, I am sure the tickets that were purchased on my card were not used by the crook and were sold on the street.

This kind of scam would be greatly reduced if people didn’t go for those great deals bought out of a guy’s trunk. We all know it is stolen merchandise. And the merchant’s who lose aren’t practising due diligence. In my case it was the travel agent who didn’t get a pin and in the case of the grocery store you know the $700 was spent for higher priced items like cigarettes and meat not milk and macaroni. Somebody should have been suspicious.

idk why she would say pay with cash, b/c at one gas station in my hometown, they give you two cents off/gallon if you pay with debit instead of cash or credit card.
maybe she was helping you out so you wouldn’t charge it and then have to pay interest on the credit card? (“don’t spend what you don’t have” kinda thing)

The reason the merchant wants you to pay cash is because they pay a surcharge on plastic sales. For example for $3/gal gas if you buy 10 gal the bank may pay the gas station owner $29. If you pay in cash he can give you a 2 cent rebate and make $29.80. That may seem like nothing on a single purchase but it adds up to thousands/mo.

When a police officer gives you advice it is more likely to do with crime than the gas sation’s bottom line.

@galileogirl – it actually goes deeper than that. Forever gas was at or under a buck a gallon, so a percentage discount was by and large the same, give or take a couple pennies as a per gallon discount. Credit card companies charge say 30 cents plus 3% of the transaction. Well, when gas was $1 a gallon and somone bought 15 gallons, it would cost the gas station 75 cents, or about 5 cents a gallon to make that sale. Since they mark up gas about 8 cents a gallon, that still represents a 3 cent per gallon, or in this case a 3% profit margin…not bad. Cash is better, but this is why often they’d give a 3 cent a gallon discount, it would save them the 30 cent surcharge and they’d make 2 more cents a gallon with cash even after a 3 cent a gallon discount.

But look at when gas was $4 a gallon. First of all, your average sale probably goes down from 15 to 12 gallons because people don’t always fill up. Now, you’ve got to pay 30 cents, plus 3% of the $48 total, so that’s $1.74. You’ve now made $3.855 per gallon. But that gas cost you $3.92 a gallon, you’ve lost 6.5 cents per gallon (insted of making 5 cents). Now some gas cards can offer as much as 5% cash back on gas, so effectively you might pay $3.80 a galon, so a 3 cent a gallon or even 5 cent a gallon discount for cash which would bring your price to $3.95 and still give you a 3 cent a gallon profit, can’t compete with a 20 cent a gallon discount, because you bear all but 5½ cents a gallon of that discount and as such LOSE money selling gas.

This is why your smaller family run gas stations have all but disappeared, and your bigger gas stations all sell food at outrageous prices…a buck for a candy bar or 4 bucks for a gallon of milk, when you can get ½ off that at a grocery store…but overall it’s just a buck or two extra and it’s worth it for you to not have to make the extra trip. They can recoup what they lose on credit card gas sales. And the other thing they all do now is have their own banks with special negotiated rates to get you to sign up for their card, because it’s going to cost them LESS per transaction if you use THEIR card than it is if you use your bank issued card, even AFTER the outrageous teaser promotions they give you (30 cents off a gallon, free $50 gift card, etc.). And of course, with competition, they don’t dare charge one penny more than they have to because they will be undercut, and people will go to a different station to save 3 cents a gallon. But they can’t undercut each other too much because the government establishes minimum profit margins for gas…many a local station in my area was able to eek out a profit by only accepting cash and charging a price lower than other stations, but was then fined a hefty sum and either went out of business or became the most expensive station in town.

@dalepetrie When I first started driving gas was 26 cents a gallon and there was no Visa or Mastercard or self service and gas stations gave you premiums for filling up. I think I basically said what you did, The reason gas stations want cash is, even giving a reduced price for cash, the cost of plastic sales is higher than the discount However the reason I even pointed this out was to dispute that a police officer would advise the use of cash for economic reasons rather than knowledge of crimes taking place.

@galileogirl – exactly, I was agreeing with you, just expanding on what you said.