LOS ANGELES (KNX) — Gas stations are increasing the amount they hold on drivers' cards when they fill up at the pump, sometimes up to $175 per transaction.
Mastercard and Visa increased the amount they allow gas stations to hold earlier this year, reasoning that truck and SUV drivers often spend more than $125 to fill their larger tanks. Individual gas stations set their limits.
"While fuel merchants have always had the ability to set their own pump shutoff limits," a Visa spokesperson told Business Insider, "this change encourages fuel merchants to allow larger fuel purchases with reduced transaction risk."
Mastercard raised its hold amount in April to "reflect trends" it said retailers and banks had seen, Insider reported. Payment transaction companies argue that companies risk not being paid if they set the hold amount too low.
Temporary holds are instituted when a buyer inserts or taps their card to purchase gasoline. It typically remains until the bank verifies the transaction amount with the retailer, removing the hold. The larger amount now being held increases the likelihood that consumers could overdraft their accounts while their gas purchase is ratified, particularly for families and individuals struggling amid record inflation.
Mastercard claimed it requires holds to be released from a card within two hours of a driver's transaction. Visa echoed its rule is the same. But users of both cards know holds can last much longer, even days.
The average for a gallon of gas nationwide hit $5 in June. In Los Angeles, the average price is $6.34 as of Tuesday. San Francisco drivers pay nearly ten cents more at $6.43 a gallon.
Experts encourage consumers with concerns to pre-pay for their fuel.
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