Hacker News Reader

Comment by patio11 | Hacker News Reader

Reg E is Reg E regardless of whether you’re on credit or debit rails, and most other regulations/laws are similar, but feel free to ask an extremely specialized lawyer for the specifics in your state.

The thing that is materially different are brand rules, because Visa/Mastercard/etc are effectively their own legal systems. They can, and do, require issuers to do certainly things vis customers and dispute resolution that go above what the law strictly requires. Those requirements may be more customer-friendly than what the debit network saddled the bank with, as debit networks have less of a brand to protect and less power over issuers.

(Speaking strictly for myself and on the basis of things I have believed for a long time: unless you need cash back, customers should choose credit ~every time.)

View on HN

The slightly tricky part is that the brand rules may still apply even if it transaction on debit rails, since the brand is printed on the card and Visa/MC doesn't want to deal with consumer complaints because the merchant routed it to debit rails despite Visa's "zero fraud guarantee" (the primary exception for this is pin debit transactions are excluded since those primarily go through debit networks). The challenge then becomes the issuer needs to take a loss as some of the debit networks don't have the chargeback infrastructure that the larger networks have, but you are often still protected by Visa rules just because the card has Visa printed on it.

Thank you for explaining how brand rules might affect the decision which payment rails to choose. But does this also apply to payment cards that were issued by banks outside the US?

When you transact with a foreign credit/debit card at a POS or ATM in the US, you are also routinely asked if you want to proceed as a credit or debit transaction. I never know what to choose and if it actually makes a difference.

Late answer:

If your foreign card is a Visa or MasterCard you should have to choose credit for your transaction to go through. In this case you still have the same chargeback rights as you would have for a transaction at home, but that might not be any (nb: even if chargebacks aren't a thing in your home country the brand rules on them still apply. Some banks will do one if you ask them nicely.)

If it's a Maestro card you should probably try credit first, but I'm not sure.

If it's a VPay card you're relying on pure luck anyway.

Is this mainly because of those brand rules which are consumer friendly?

Reply on news.ycombinator.com