what is courtesy pay for a debit card?
In: Economics
It‘s tolerated overdraft.
Bank allows your account to temporarily go into the negative for high interest rates.
Compared to actually having overdraft set up with them for a specific amount.
They do that because it is much more beneficial for the bank to go ‚ah well she paid for 10 usd more than she has in her account, we‘ll allow that since we know her wages come in in a couple of days anyway and tack on a bit of interest‘ rather than go ‚no insufficient funds, transaction blocked‘
The latter would either embarrass you at some shop; or have some company drying to do a withdrawal tack on late/processing fees leading to pissed of and annoying customers.
Basically bank expects you to be liquid in general and therefore lets an uncovered transaction go through.
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