Payment Systems
Regardless of the bank or building society that provides your current account, your debit card will be associated with one of the four large payment systems in the UK. These are: Maestro, Solo, Visa Debit and Visa Electron. Which payment system your debit card utilises varies between institutions. Your bank or building society may take your personal circumstances into account, to decide which payment system is best suited to you. Deciding factors may be:
- your credit score
- regular deposits you make
- current account balance
- past payment behaviour, for example, if you make informal overdraft requests or have been overdrawn in the past
If your bank or building society regards you as more likely to make late credit payments or withdraw more than your current account balance allows, they may not provide you with 'full' debit card facilities, such as a cheque guarantee facility.
The main difference between the four payment systems is the way in which transactions are authorised. Solo and Visa Electron verify that you have the appropriate current account funds before authorising the transaction: this is referred to as online authorisation. In contrast, Maestro and Visa Debit card holders can make withdrawals and payments that exceed their current account balance. This is referred to as offline authorisation.
In most cases, you will not notice the difference between these payment systems. However, by using online authorisation, Solo and Visa Electron do not support 'full' debit card services. The main service that is not available on Solo and Visa Electron cards is Cheque Guarantee. The cheque guarantee service provides retailers with extra protection if you make a purchase using a personal cheque. In the event that you do not have the required current account balance to cover the cheque amount, the bank guarantees to the retailer that they will honour the payment. Only Maestro cards and Visa Debit cards will offer the cheque guarantee service. If you do not manage your current account balance well, your bank or building society may not offer you the cheque guarantee service or may remove it from your Maestro or Visa Debit card. Some may offer you a Solo or Visa Electron card instead, which will help you manage your finances more effectively.
