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Can you be rejected for a debit card?

Two Target shoppers were surprised to learn they'd been turned down for a Target REDcard debit card.

By MSN Money Partner May 4, 2012 2:30PM

This post comes from Geri Detweiler at partner site on MSN MoneyWhen a clerk at Target told Annette Tierney she could save 5% on her purchases by opening a Target REDcard debit card, it was a no-brainer. "Every time we go in there we get a cart full of stuff," she explains. "We usually spend $250 to $500."


Image: Worried Woman (© Stockbyte/Getty Images)It also seemed simple enough: The store's debit card is set up to draw from a customer's existing checking account. She was shocked, though, when her application for the card was declined.


Since she and her husband avoid debt and have "great credit," her first thought was that perhaps they had been victims of identity theft. But when she called the customer service number provided, she was told her application was declined due to a lack of check-writing history with Target. She told the representative that she uses a bank debit card when she shops at Target, but the representative wouldn't budge. She was told she'd have to first establish a check-writing history with Target to be considered for the card.


Tierney's situation raises the question: Can you get turned down for a debit card? On the surface, it would seem that the answer would be "no," or at least not likely, because the card is only used to access the money you already have in your bank account. But, in fact, you can be turned down for a debit card, though the reason is most often due to prior checking account problems. (Post continues below.)

That's what Rosalie Zamora found out when her application to open a Target REDcard debit card was declined. "I received a 'regret' notice indicating that there was some negative reporting from a reporting agency called Certegy," she said in an email to Certegy provides check authorization and guarantee services to merchants and businesses nationwide, and is considered a specialty consumer reporting agency under federal law.


Zamora called Certegy and was told there was no negative information on file for her. She was then referred to another consumer reporting agency, TeleCheck, which found an unpaid debt from ACCS Bad Check Restitution. When she called that company, she found out that her information had been mixed up with that of someone who previously bounced a check:

I was sent three letters of apology stating that a clerk at a store keyed in a driver's license number incorrectly for someone cashing a $50 check a few years ago that bounced. That driver's license (number) ended up being mine and went on my record. They say that they have unlinked my driver's license to that case and I should be good to go now.

Tierney, on the other hand, still doesn't understand why she can't get the card. The debit card application states (.pdf file)  that "Target may gather any information considered necessary and appropriate, including consumer reports." However, it makes no specific mention of requiring consumers to have a check-writing history at the store.


"They didn't (admit) it was a ridiculous excuse," she fumed.

She's since sent email complaints to members of Target's executive board. I shared with her that I was surprised by her story because I opened a Target REDcard debit card last year and, to my knowledge, I have never written a check at Target.


Target officials declined to comment for this story.


Tierney speculates that Target would rather have her sign up for its credit card than the debit card. "I feel like they are using this great advertising campaign, but I feel like what they really want is for people to use their credit card. They want to push American consumers deeper and deeper into debt. That's just my theory," she says.


And even though Zamora's check-writing history has been cleared, she didn't appeal the decision with Target. "Forget it," she says. "I'm done with Target. Although it's not their fault, this issue left a bad taste in my mouth."


More on and MSN Money:

May 4, 2012 5:50PM
Take your business elsewhere And write a letter to the head or heads of the company stating EXACTLY why you will NEVER shop at Target again.  Also, let everyone you know exactly what happened.  Bet they tell all their friends, too.  Also if you have a facebook account, post there.  Bet you hear from the company pronto after that!!!
May 4, 2012 5:11PM
Just don't shop there anymore. There are plenty of other places to shop and I'm sure they'd be happy to give you a debit card and a 5% discount, no problem.
May 4, 2012 11:20PM
Great Job! target! way to piss off a customer that usually spends $250-$500 every time she shops there!
May 4, 2012 5:45PM
People still write checks? Wow I don't think I've written a check out in over 10 years.......
May 4, 2012 7:05PM
Screw Target!! Heartless bastards,,,
May 4, 2012 11:36PM
They need to do away with all of the varied credit bureau agencies (TransUnion, Experian, etc.) and make ONE national credit bureau. These damn bureaus never agree with each other anyway. That way if there is a're not dealing with 3 separate companies to get it cleared...dumb system for WAY too long
It wasn't Target's fault! The fault was with a credit reporting service. I can solve that problem in seconds: Make credit agencies liable for their mistakes. They are entirely too quick to down-rate somebody on thin to no evidence and with no real corroboration. They could then be sued for their irresponsibility. No, I've never been turned down for anything because of a poor credit rating (mine is very high) but people doing a poor job just sends me up the wall.
May 4, 2012 8:55PM

There is no reason to get a store credit card (which usually has a very high interest rate over bank credit cards) or use anything but your bank debit card (treated the same as a credit card). credit cards are for emergencies or purchases you pay off at the end of the month (which helps establish your credit history for the idiots who ping you because you don't use credit). One credit card is all you need. Don't get suckered into getting more than that and make sure you read the fine print or the stuff in the "box" on the application. Never get anything that charges you an annual fee or has a two-month average daily balance. (Discover is notorious for this one.)


Here's why: I had a discover card back in my salad (i.e., stupid about credit) days. I paid off an $11,000 bill to discover, but forgot that I charged something that month of $40.00. So when I get the bill the next month, instead of getting a bill for $40.00 I got a bill for $240.00 because they looked at the balance from the previous month when it was $11,000 and applied the interest over the two month period. I paid the bill, but I never went back to discover again.

May 4, 2012 8:22PM
I applied for a credit card at Wal-Mart. If you spent one hundred dollars they will give you twenty dollars back. Sounded like a good deal. I was refused a card. Got a letter from GE Capital retail bank. Reason; Insufficient Credit History On file. I guess if you live in a cash only world like I do you get no credit.
May 4, 2012 11:58PM

Why use their crappy middleman for a debit card, why not keep using the one from your bank?


To me the less cards I pack around means less chance of ID theft, accounting mistakes, etc, etc.

May 5, 2012 2:10AM
Target pulled the same crap with me. I haven't set foot in their store since.
May 4, 2012 5:31PM
Screw them is supposed to be French owned. Who needs them.
May 4, 2012 9:12PM
One way to handle it is to shop elsewhere.  Then perhaps they'd question their methods.  Considering practically every place on the planet gives some sort of rewards for shopping with them, I see no reason to shop at Target or to get one of their cards.  Firstly, it's a big drive and most things are available at one store or another here anyway. 
May 5, 2012 3:03AM

I wanted to buy a tv and wrote a check and they refused it even though i had never bounced a check. they said I had no check writing history. so i used my debit card on another account. it was embarrasing and I did nothing wrong other than write a check of which they acknowledged there wasn't anything negative other than there was no history with that checking account. how stupid

May 4, 2012 9:25PM
target or should i say dayton-hudson has a long history of unusual credit practices. i know of one person in the 90's who could not get a 2500 line on the red card(private card) but gave them 7500 on a target brand visa card. I for one can not see why they exist except for those people who quote STEP UP FROM WALMART.
May 4, 2012 9:47PM
All the debit cards I have come across want me to pay for the convenience of using my own money........Huh??????????????? No thanks
May 7, 2012 7:54PM

Kiss86, As a matter of fact, YES, debit cards are charged a ''swipe fee'' levied on retailers when customers used their debit cards to make a purchase at any retail outlet. This fee is in addition to the ''interchange fee'' that banks charge retailers for ''processing'' those debit card transactions. So even if you don't have a monthly service fee for the account to which your debit card is attached you are still paying one way or another because the retailers have to hike up the prices to cover those cards....this, as a retailer myself, I can assure you.  And no checks for 2 years?  Do you have automatic withdraw and online banking for all your utilities?  It will be a cold day in hell when I give anyone the power to pull moneys from my account other then me.  Automatic payments takes your leverage right out of the picture if you ever have an issue with the company to whom you are paying.

May 5, 2012 12:38AM
I haven't written a check in 2 years! Use my bank's debit card or cash for everything! If a place doesn't accept debit cards (some places around here actually don't) then I don't go there...I will shop elsewhere. I don't spend enough at target to even care about 5% off my purchases. They ask me everytime I am in there if I want to apply and I just tell them no, 5% isn't worth it.
May 4, 2012 5:20PM
I gave up on debt cards a long time ago .. to much hassle to use my own money.
May 5, 2012 12:43AM
Just Another Observer - What - a service fee on a debit card? where are you getting this information...I have been using a debit card for 2 years and have NEVER paid any sort of service fee...
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