When Is Your Money Not Your Money

Answer: when you've generated a credit on your credit card.

I was shopping recently and bought something with my VISA card. The vendor rang it up wrong and couldn't just cancel the transaction but had to generate a credit. I went to re-buy the item (rung up correctly) and the transaction was denied. I called the credit card company and they were, thankfully, watching out for abuse, and the two large charges at the same place had locked out my account to prevent fraud.

I asked the lady at the CC company to let me make the 2nd purchase. She, I guess, was willing to accept its validity by having the checker run the charge through at that exact moment (I suppose the fact that I had proven my ID with her satisfied her). In no less than 5 seconds she saw the exact amount of the new sale amount. I was amazed at technology (remember when the clerk had to CALL the credit card company on the phone for sales over a certain amount and was given an "authorization number" to write on the "charge slip"?) but it made me ask "If your computers can get the debit so quickly, why didn't they get the credit just as fast, which would've cancelled out the FIRST transaction so your system wouldn't have raised a flag?" She said she didn't know; credits take up to 48 hours.

What a racket! Even if they only get $100,000 a day in credits (I'll bet it's more) think of the INTEREST they've earned on YOUR money! For that two days, your money is theirs; you do not have any merchandise or services since you've given the stuff back to the merchant yet you don't have your money either! The credit card company or bank has it!

Now, it's not like you could have earned interest on that money but you could have spent it. If you bought one item for the total amount of your remaining credit limit and then returned the item, you still couldn't have bought anything more until the credit went through.

Since I don't know how the credit card system works, I'm not sure who's making interest on whose money, but it looks like a wild scheme!