By CANDICE CHOI

Americans prefer using their debit cards at the register. But a small fee could change that.

A new Associated Press-GfK poll finds that about two-thirds of consumers use debit cards more frequently than credit cards. But when debit card holders were asked how they would react if they were charged a $3 monthly fee for their debit card, 61 percent say they’d find another way to pay.

If the fee was $5, 66 percent would do the same. If the fee was $7, the figure rises to 81 percent.

The findings come at a time when consumers are seeing unwelcome changes to their debit cards and the checking accounts to which they’re linked. Although banks haven’t started imposing monthly fees for debit cards, there are signs higher costs could be on the way.

Starting in October, a new cap will sharply limit the revenue banks can collect from merchants whenever customers swipe their debit cards. That revenue has been a critical income source for banks; merchants paid issuers $19.7 billion for debit transactions in 2009, according to the Nilson Report, which tracks the payments industry.

Consumers are already seeing the fallout. Chase, PNC Bank and Wells Fargo ended or scaled back their debit rewards programs citing the new regulation. The availability of free checking accounts also declined last year for the first time since 2003.

And more changes could be in store.

Chase, for example, is testing a $3 monthly fee for debit cards on new accounts in northern Wisconsin. In Atlanta, it’s testing a $15 monthly fee on basic checking accounts.

Among the AP-GfK poll respondents who say they would leave their debit cards in their wallets in the face of such fees, more say they’d pay with cash, 53 percent, or check, 42 percent, rather than another form of plastic.

“Cash or checks — they’re not very expensive,” said Aaron Alto, a 44-year-old resident of Grand Rapids, Minn. Alto says he’d be annoyed enough to look for an alternative to his debit card if the fees approached $10.

Debit card fees would cause 22 percent to switch to credit cards, and 12 percent say they would switch to a prepaid spending card.

For now, the notable preference for debit could be linked to a negative sentiment about credit cards; nearly half of respondents to the AP-GfK poll say the interest rates they’re charged are unfair.

That may be because 30 percent had their interest rates hiked in the past two years. That’s more than twice the number who say their rates were lowered.

Forty-two percent of respondents also say the fees and penalties on their cards are unfair; 37 percent say card issuers recently raised those potential charges.

The higher rates and fees may have surprised consumers in light of the new regulations that were intended to protect cardholders and put an end to questionable billing practices.

Under the rules that went into effect last February, cardholders are now entitled to 45 days notice before their rates are hiked. Card issuers are also prohibited from raising rates on existing balances, a once-common practice that consumer advocates had long decried.

Additionally, the one-time penalty fees for late payments are capped at $25 per violation. But there’s no limit on how high banks can hike interest rates on purchases or the default interest rates that kick in when customers are late on payments.

Earl Law, a 61-year-old resident of Buffalo, N.Y., said the penalty rate on a few of his cards is 30 percent.

“It’s absurd. It’s usurious,” he said. “If you’re struggling with debt, that’s the last thing you need. You’re asking people to fail.”

Despite the widespread discontent with interest rates, the regulations are having a clear, positive impact in one area: monthly statements. Nearly half of respondents say they’re now easier to understand.

Part of the reason is that the new law requires credit card issuers to spell out the cost of carrying a balance. For example, statements now include a chart that shows how long it would take to pay off a balance if only minimum payments were made. The chart also includes the total amount the cardholder would pay over that time, including interest charges.

The increased transparency might be one reason why the majority of consumers — 78 percent — say they plan to stick with their cards, despite their grumblings about high rates and fees.

It could also be that consumers have grown numb to unpleasant changes. In the months leading up to the passage of the new regulations, many cardholders saw their interest rates hiked, credit limits slashed and inactive accounts shut down.

The poll was conducted June 16-20 by GfK Roper Public Affairs and Corporate Communications. It involved landline and cell phone interviews with 1,001 adults nationwide, including 715 who have credit cards and 706 debit card holders. Results from the full sample have a margin of sampling error of plus or minus 4.1 percentage points; it is 4.8 points for those with credit or debit cards.

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Associated Press Polling Director Trevor Tompson, Deputy Polling Director Jennifer Agiesta and AP News Survey Specialist Dennis Junius contributed to this report.

Online:

Poll results: http://www.ap-gfkpoll.com

 

 

How the poll was conducted

By The Associated Press

The Associated Press-GfK Poll on changes to credit card laws was conducted by GfK Roper Public Affairs & Corporate Communications from June 16-20. It is based on landline and cellphone interviews with a nationally representative random sample of 1,001 adults. Interviews were conducted with 700 respondents on landline telephones and 301 on cellphones. The sample included 715 credit card holders and 706 debit card holders.

Digits in the phone numbers dialed were generated randomly to reach households with unlisted and listed landline and cellphone numbers.

Interviews were conducted in both English and Spanish.

As is done routinely in surveys, results were weighted, or adjusted, to ensure that responses accurately reflect the population’s makeup by factors such as age, sex, education and race. In addition, the weighting took into account patterns of phone use — landline only, cell only and both types — by region.

No more than one time in 20 should chance variations in the sample cause the results to vary by more than plus or minus 4.1 percentage points from the answers that would be obtained if all adults in the U.S. were polled. For results among credit card holders and debit card holders, the margin of sampling error is plus or minus 4.8 percentage points.

There are other sources of potential error in polls, including the wording and order of questions.

The questions and results are available at http://www.ap-gfkpoll.com .

 


AP-GfK Poll: Can Supreme Court be fair in health law case?

WASHINGTON (AP) — Many people in the United States doubt that the Supreme Court can rule fairly in the latest litigation jeopardizing President Barack Obama’s health care law.

The Associated Press-GfK poll finds only 1 person in 10 is highly confident that the justices will rely on objective interpretations of the law rather than their personal opinions. Nearly half, 48 percent, are not confident of the court’s impartiality.

“That lawsuit should have never made it this far,” said Hal Lewis, a retiree from Scranton, Pennsylvania.

“If they rule for the people who are bringing the suit, it could be close to the destruction of Obamacare in this country,” added Lewis, who once edited a local newspaper in his city.

Lewis is one of the relatively few people — 13 percent — who say they are closely following the case, called King v. Burwell.

Opponents of the law argue that as literally written, the law only allows the federal government to subsidize premiums in states that have set up their own insurance markets, also known as exchanges. Most states have not done so, relying instead on the federal HealthCare.gov website.

The Obama administration says opponents are misreading the Affordable Care Act by focusing on just a few words. When the legislation is read in context, it’s clear that lawmakers wanted to help uninsured people in every state, the administration maintains.

If the court sides with the plaintiffs, it’s estimated that 8 million to 9 million people across more than 30 states could lose coverage. They would be unable to afford their premiums without the subsidies, which are keyed to household income. A decision is expected late in June.

In a twist, the poll found that opponents of the law, who tend to be politically conservative, have less confidence in the objectivity of a court with a conservative majority. Among foes, 60 percent are not confident, compared with 44 percent of the law’s supporters.

“That is incredibly powerful that a court associated with conservative views is not well trusted by Republicans,” said Robert Blendon, who tracks public opinion on health care at the Harvard T.H. Chan School of Public Health. Blendon said the law’s opponents may be remembering the court’s 2012 ruling in which Chief Justice John Roberts cast the key vote to uphold the law.

Regardless of how the public feels about the court’s internal deliberations, a majority wants the justices to allow subsidies to continue flowing in all 50 states, an opinion in line with the administration’s position.

Fifty-six percent said the court should keep the subsidies without restriction, while 39 percent said the financial aid should be limited to residents of states that set up their own health insurance markets.

It’s less clear what people would want Congress to do if the court were to side with the law’s opponents. A ruling for the plaintiffs would invalidate health insurance subsidies in states without their own exchanges. Many of those states have Republican governors and legislatures that have resisted the health care law.

The poll found that a bare majority, 51 percent, wants Congress to amend the law to make it clear that people are entitled to help regardless of what their state leaders do.

But 44 percent prefer that Congress leave the law as is and let states decide whether they want to create insurance exchanges that would allow their residents to receive subsidies.

“It suggests there’s a political opening for Republicans to offer a way for people to continue receiving subsidies through some sort of state arrangement,” Blendon said.

State leaders would have to move fast. Some legal experts say it would be only weeks before the subsidies dry up; others say it’s possible the administration could continue payments through the end of this year.

Ethan Levesque of Augusta, Maine, said he is troubled by the federal law’s requirement that virtually all U.S. residents get health insurance or risk fines from the IRS.

“I feel like it should actually be the determination of the states to decide health coverage,” said Levesque, a customer service representative for a telecommunications company.

“There is definitely nothing wrong with health care whatsoever, but it’s the way that this has been presented to people that I have problems with,” he said.

The poll found sharp splits on whether Congress should intervene.

Two-thirds of Democrats think Congress should amend the law to save the subsidies, but only 31 percent of Republicans shared that view. Half of independents want Congress to update the law if necessary, while 41 percent think it should be kept as is.

Leading congressional Republicans have said they would step in to prevent health insurance markets from unraveling, but they have not spelled out details.

It’s estimated that 15 million to 17 million adults have gained coverage since the fall of 2013, when the law’s big insurance expansion began. But the nation is divided over Obama’s major domestic policy achievement.

The poll found 27 percent of Americans support the law, while 38 percent oppose it and 34 percent say they neither support nor oppose it.

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The AP-GfK Poll of 1,077 adults was conducted online April 23-27, using a sample drawn from GfK’s probability-based KnowledgePanel, which is designed to be representative of the U.S. population. The margin of sampling error for all respondents is plus or minus 3.4 percentage points.

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Online:

AP-GfK Poll: http://www.ap-gfkpoll.com


AP-GfK Poll: Immigration not a deal breaker for Republicans

By EMILY SWANSON  Associated Press

WASHINGTON (AP) — Americans are split down the middle on whether they would prefer to vote for a candidate who wants to keep or undo President Barack Obama’s executive action to let some immigrants living in the U.S. illegally stay in the country, according to a new Associated Press-GfK poll.

But even Republicans don’t necessarily see a candidate’s support for that action as a deal breaker for their votes.

The poll was conducted before former Secretary of State Hillary Rodham Clinton said Tuesday that she supports a path to citizenship and that, if elected president, she would expand the protections for immigrants laid out in Obama’s executive action.

Five things to know about public opinion on immigration:

HALF SUPPORT PATH TO CITIZENSHIP, LEGAL STATUS

Most Americans – 53 percent – say they favor providing a way for immigrants who are already in the United States illegally to become U.S. citizens, while 44 percent are opposed.

And although Clinton drew a stark line Tuesday between support for citizenship and support for legal status to stay, the poll shows that distinction makes little difference in people’s support for a change in immigration policy.

Among Americans asked if they favor a way for those already in the United States to stay legally, 50 percent were in favor and 48 percent opposed – not a significant difference from support for a path to citizenship.

DIVISION OVER OBAMA EXECUTIVE ACTION

Forty-nine percent say they’re more likely to support someone who wants to keep Obama’s immigration action in place, while 47 percent would rather vote for someone who wants to undo it, the AP-GfK poll shows.

That’s true even though most Americans support the policies that make up the executive action. Fifty-nine percent favor providing a way for immigrants brought to the United States illegally as children to stay legally, and 57 percent support allowing those who are in the country but whose children are U.S. citizens or permanent residents to stay.

Americans on both sides of the executive action issue are just as likely to say that they could imagine voting for a candidate who disagrees with them as say they could not.

NOT A DEAL BREAKER FOR REPUBLICANS

Even among Republicans, many say they could see themselves voting for a candidate who wants to keep Obama’s action in place.

Three-quarters of Republicans say they would prefer to vote for a candidate who would undo it, but a combined 55 percent would either prefer to support a candidate who would keep it in place or could imagine themselves voting for such a candidate.

Even among conservative Republicans, nearly half – 47 percent – could at least imagine voting for a candidate who would keep the action in place.

Significant minorities of Republicans – about 4 in 10 – support allowing immigrants brought to the United States as children, along with parents of citizens or permanent residents, to stay legally.

LINE IN THE SAND FOR HISPANICS

Three-quarters of Hispanics in the poll say that they would prefer to support a candidate who would keep Obama’s executive action in place, and a majority – 53 percent of Hispanics overall – say they definitely could not support a candidate who wants to undo it.

Eight in 10 Hispanics in the poll favor allowing those brought to the country as children, and those who are parents of citizens or permanent residents, to stay legally.

Hispanics are more likely to trust Democrats than Republicans on handling immigration, 36 percent to 21 percent. But nearly a third don’t trust either party on the issue.

Among all Americans, 30 percent trust Democrats more and 26 percent trust Republicans more, while29 percent trust neither party and 15 percent trust both equally.

MOST DISAPPROVE OF OBAMA’S HANDLING OF IMMIGRATION

Americans are more likely to disapprove than approve of how the president is handling immigration, 57 percent to 42 percent. That’s unchanged since the last AP-GfK poll early in February.

Fifty-seven percent of Americans call immigration a very or extremely important issue to them personally, up slightly since 52 percent in February.

Among Hispanics, 6 in 10 approve of how Obama is handling immigration. In October, before he announced the immigration action, only 3 in 10 did.

The AP-GfK Poll of 1,077 adults was conducted online April 23-27, using a sample drawn from GfK’s probability-based KnowledgePanel, which is designed to be representative of the U.S. population. The margin of sampling error for all respondents is plus or minus 3.4 percentage points. Some questions were asked of a half sample and have a higher margin of error.

Respondents were first selected randomly using phone or mail survey methods, and later interviewed online. People selected for KnowledgePanel who didn’t otherwise have access to the Internet were provided access at no cost to them.

Online:

AP-GfK Poll: http://www.ap-gfkpoll.com

Follow Emily Swanson on Twitter at: http://twitter.com/EL-Swan