"Business Tries Debit Cards Instead of Pay Checks" says the title.

The problem here is that the majority of places using them are doing so because their employees can't get a bank account that they can deposit checks into. (...and let's try not to think about the privacy issues involved)

This happens for a few reasons, bad credit being one, bouncing a lot of checks being another, and a big new one... no legal residence because they're illegal aliens. (It's not real hard to have one bank refuse to give you a checking account, and if they won't give you a checking account you're not getting a debit card account either, as at least one user here I know of has found out in the past. Once one bank hits this point, none of them will touch you.)

These pay card arrangements let banks cash in on the easy money that the financially disadvantaged would otherwise have been giving to those shifty check cashing shops which charge pretty sizable percentages. ...because if you use these cards at an ATM, well, you're probably not really a member of any bank, so you're going to be paying that two-dollar-and-higher fee to the ATM vendor every time. This can easily be as much as 10-15% of someone's income getting eaten in fees trying to get the money back out of that card.

One can argue that they don't have to use an ATM, but the fact of the matter is that they do use them just like most them don't have to use the pay-day advance services and check into cash shops, but they still do. Bad decision-making (and it doesn't even have to be seriously bad decisions, just mildly bad ones will do) coupled with unrealistic depictions of how things should work by amoral businesses is how many of these people got the low financial tier in the first place. That people use them not knowing exactly what kind of mess they're getting themselves into is how these places have been consistently coming up with 700% and higher returns on their investments.

Another big plus for the businesses is that if they write a check, the moment the employee deposits it the money leaves the bank the employer is using and probably doesn't come back. Giving employees a debit card allows the financial institution to just hang onto that money for that much longer--especially in the case of people who can't get a "real" bank account.

But hey, I guess it should be considered progressive that now large financial institutions can tap into the same heady revenue sources that were previously only the domain of sleazebags and loan sharks. The poor may not have much money, but they are the overwhelming majority case, and they're a lot easier to bilk than the rich.

Formalized Stupidity Comes To Nashville