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.

___

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: Americans prefer low prices to items ‘Made in the USA’
WASHINGTON (AP) — The vast majority of Americans say they prefer lower prices instead of paying a premium for items labeled “Made in the U.S.A.,” even if it means those cheaper items are made abroad, according to an Associated Press-GfK poll.

While presidential candidates like Donald Trump and Bernie Sanders are vowing to bring back millions of American jobs lost to China and other foreign competitors, public sentiment reflects core challenges confronting the U.S. economy. Incomes have barely improved, forcing many households to look for the most convenient bargains instead of goods made in America. Employers now seek workers with college degrees, leaving those with only a high school degree who once would have held assembly lines jobs in the lurch. And some Americans who work at companies with clients worldwide see themselves as part of a global market.

Nearly three in four say they would like to buy goods manufactured inside the United States, but those items are often too costly or difficult to find, according to the survey released Thursday. A mere 9 percent say they only buy American.

Asked about a real world example of choosing between $50 pants made in another country or an $85 pair made in the United States — one retailer sells two such pairs made with the same fabric and design — 67 percent say they’d buy the cheaper pair. Only 30 percent would pony up for the more expensive American-made one. People in higher earning households earning more than $100,000 a year are no less likely than lower-income Americans to say they’d go for the lower price.

“Low prices are a positive for US consumers — it stretches budgets and allows people to save for their retirements, if they’re wise, with dollars that would otherwise be spent on day-to-day living,” said Sonya Grob, 57, a middle school secretary from Norman, Oklahoma who described herself as a “liberal Democrat.”

But Trump and Sanders have galvanized many voters by attacking recent trade deals.

From their perspective, layoffs and shuttered factories have erased the benefits to the economy from reduced consumer prices.

“We’re getting ripped off on trade by everyone,” said Trump, the Republican front-runner, at a Monday speech in Albany, New York. “Jobs are going down the drain, folks.”

The real estate mogul and reality television star has threatened to shred the 1994 North American Free Trade Agreement with Mexico and Canada. He has also threatened to slap sharp tariffs on China in hopes of erasing the overall $540 billion trade deficit.

Economists doubt that Trump could deliver on his promises to create the first trade surplus since 1975. Many see the backlash against trade as frustration with a broader economy coping with sluggish income gains.

“The reaction to trade is less about trade and more about the decline in people’s ability to achieve the American Dream,” said Caroline Freund, a senior fellow at the Peterson Institute for International Economics. “It’s a lot easier to blame the foreigner than other forces that are affecting stagnant wage growth like technology.”

But Trump’s message appeals to Merry Post, 58, of Paris, Texas where the empty factories are daily reminders of what was lost. Sixty-eight percent of people with a favorable opinion of Trump said that free trade agreements decreased the number of jobs available to Americans.

“In our area down here in Texas, there used to be sewing factories and a lot of cotton gins,” Post said. “I’ve watched them all shut down as things went to China, Mexico and the Philippines. All my friends had to take early retirements or walk away.”

Sanders, the Vermont senator battling for the Democratic nomination, has pledged to end the exodus of jobs overseas.

“I will stop it by renegotiating all of the trade agreements that we have,” Sanders told the New York Daily News editorial board earlier this month, saying that the wages paid to foreigner workers and environmental standards would be part of any deal he would strike.

Still, voters are divided as to whether free trade agreements hurt job creation and incomes.

Americans are slightly more likely to say free trade agreements are positive for the economy overall than negative, 33 percent to 27 percent. But 37 percent say the deals make no difference. Republicans (35 percent) are more likely than Democrats (22 percent) to say free trade agreements are bad for the economy.

On jobs, 46 percent say the agreements decrease jobs for American workers, while 11 percent say they improve employment opportunities and 40 percent that they make no difference. Pessimism was especially pronounced among the 18 percent of respondents with a family member or friend whose job was offshored. Sixty-four percent of this group said free trade had decreased the availability of jobs.

___

The AP-GfK Poll of 1,076 adults was conducted online March 31-April 4, 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 3.3 percentage points.

Respondents were first selected randomly using telephone 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:

http://ap-gfkpoll.com

___

On Twitter follow Emily Swanson at @EL_Swan and Josh Boak at @joshboak


AP-GfK Poll: Public wants Senate action on court, but interest is modest

WASHINGTON (AP) — Nearly 2 in 3 Americans back Democrats’ demands that the Republican-run Senate hold hearings and a vote on President Barack Obama’s pick for the Supreme Court. But an Associated Press-GfK poll also suggests that GOP defiance against considering the nominee may not hurt the party much because, to many people, the election-year fight is simply not a big deal.

Just 1 in 5 in the survey released Wednesday said they’ve been following the battle over Obama’s nomination of federal judge Merrick Garland extremely or very closely.

That included just 26 percent of Democrats and 22 percent of Republicans expressing intense interest, along with a scant 8 percent of independents. That aligns with the political reading of the issue by many Republicans that while it motivates each side’s most committed partisans, people in the middle consider it a yawner — making the fight essentially a wash.

Another clue that voters not dedicated to either party find the court fight tiresome: While just over half of Democrats and Republicans said the issue is extremely or very important, only around a third of independents — and half of Americans overall — said so.

About 8 in 10 said that about the economy and about 7 in 10 took the same stance about health care and the threat posed by the Islamic State group. Immigration and the U.S. role in world affairs both attracted slightly more intensity of interest than the court battle.

“It gets me irritated, the bickering and all that kind of stuff,” Julie Christopher, 49, a Republican and flight attendant from Fort Worth, Texas, said in a follow-up interview, describing her modest attention to the issue.

Christopher said that while she agrees with the GOP’s refusal to hold hearings on Garland, when it comes to backing candidates in November, “That’s not going to be my only thing, like boom, I’m not going to vote for them.”

Hours after Justice Antonin Scalia’s death in February, Senate Majority Leader Mitch McConnell, R-Ky., said his chamber would not consider an Obama nominee and would instead wait until the president elected this November makes a pick. With the remaining justices split 4-4 between those leaning conservative or liberal, most GOP senators have lined up behind McConnell.

Democrats have been spewing outrage ever since. Along with liberal groups, they’ve been using television ads, news conferences, public demonstrations and Senate speeches to ratchet up pressure on GOP senators, especially those facing re-election this fall in swing and Democratic-leaning states like Illinois, New Hampshire, Wisconsin, Pennsylvania and Ohio.

Democrats’ theory is that the public wants Republicans to end their obstruction and let the Senate do its job, forcing GOP senators to relent on Garland or risk defeat in November. The AP-GfK poll has some data backing that up.

The 64 percent who favor hearings and a vote this year on Garland include an overwhelming proportion of Democrats and a sizable minority of Republicans, 40 percent. Independents, who can be pivotal in closely divided states, back action this year, 52 percent to 36 percent.

“I’d rather see at least deliberations, and see Congress do its job,” said Marc Frigon, 33, a high-tech worker from Beverly, Massachusetts, who leans Republican and wants the Senate to reject Garland’s confirmation. “I feel like that’s why we elected them in the first place.”

Just over half of moderate and liberal Republicans want the Senate to hold hearings this year, while fewer than 3 in 10 GOP conservatives say that.

Overall, people say by 59 percent to 36 percent that they want the Senate to approve Garland should a vote be held. Nearly 9 in 10 Democrats favor confirmation and independents tilt slightly that way, while 69 percent of Republicans favor rejecting him.

In another sign that the public tips toward Obama on the issue, 57 percent approve of the way he’s been handling the Garland nomination. That’s more than the number who gave the president positive reviews on any other issue in the poll: the economy, health care, Islamic State militants, immigration and world affairs.

The AP-GfK Poll of 1,076 adults was conducted online March 31-April 4, 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 3.3 percentage points.

Respondents were first selected randomly using telephone or mail survey methods and later interviewed online. People selected for KnowledgePanel who didn’t have access to the Internet were provided access for free.

___

Online:

http://ap-gfkpoll.com