How to Use a Credit Card at the Gas Pump (And Avoid Holds)

If you’ve ever stood at a pump wondering why it wants your ZIP code, or why your balance looks higher than what you spent, both are normal when you pay with a credit card. The ZIP confirms you’re the cardholder, and the extra amount is a temporary hold that’s replaced by your actual total after you fill up. Paying at the pump takes about a minute and can earn you fuel rewards. It just helps to know how the hold works if your available credit is tight.

5 steps to use a card at the gas pump

1. Insert or tap your card

Most pumps take chip cards, and many also accept tap. Follow the prompts on-screen, and the pump will verify your card.

If the pump declines your card, don’t keep retrying at other pumps. Each attempt can place another hold. Pay inside instead.

2. Enter your ZIP code

The pump will probably ask for your billing ZIP code. It checks that number against what your card issuer has on file, so someone who steals your card can’t easily fill up on it.

The pump may also offer a rewards sign-in or a car wash. You can skip these to keep going.

3. Select your fuel grade

Once your card is verified, choose the fuel grade you want. Check the price per gallon on the button before you press it. Some stations post a lower cash price, so look at the sign if you’re comparing.

4. Pump your gas

Lift the nozzle, insert it into your tank, and squeeze the handle to start fueling. Many pumps have a clip that holds the handle open, so you don’t have to squeeze the whole time.

5. Remove the nozzle and get your receipt

When the pump clicks off, hang the nozzle back up and print a receipt if you want one. The station sends your final total to your card issuer, usually within a couple of hours. How fast the pending hold disappears from your account is up to your issuer. It’s often the same day, but it can take a few days. If it’s still showing after that, call the number on the back of your card.

Read more >> What Is Credit Card Skimming and How to Avoid It at the Pump

Why gas stations place a hold on your card

If your card app shows a bigger charge than your fill-up, don’t panic. That’s the hold, and it’s supposed to be there. The station doesn’t know how much gas you’ll buy, so it places a temporary hold for a set amount, up to $175 with Visa and Mastercard. The hold shows as a pending charge and lowers your available credit until the real total posts.

The hold makes sure the station gets paid for what you pump. The amount can vary by station. Some list it on a sticker at the pump.

Read more >> How Long Do Pending Transactions Take to Post?

Tips for using a credit card at the pump

A few habits keep the hold from getting in your way:

• Check your available credit first if you’re close to your limit, since a hold up to $175 can block other purchases until it drops off.
• Pay inside for a set amount to avoid the pump’s default hold. If you pump less than you paid, go back in for the difference.
• Save your receipt in case the hold or final charge looks wrong.

Credit card vs. debit card at gas stations

The steps are the same with either card. With debit, the pump may ask for your PIN or your ZIP, depending on how the card is run. The real difference is what the hold ties up.

Both can get a hold, but they affect you differently. On a credit card, a hold lowers your available credit. On a debit card, it ties up money in your checking account, which could cause an overdraft or a declined purchase if your balance is low.

Read more >> Are Credit Cards Safer Than Debit Cards?

No credit card yet? If debit is how you pay at the pump, a hold can tie up cash you're counting on. Building a credit history can help you qualify for a card of your own. Kikoff's Credit Account reports your on-time payments to all three bureaus. Plans start at $5 a month with no credit check.

How paying for gas affects your credit

The hold itself doesn’t show up on your credit report. It’s a pending charge, not part of the balance your issuer reports.

Paying your card on time helps build a positive credit history. On-time payment history is one of the most important factors used to calculate your score.

If you carry the balance past your due date, interest starts adding up. A high balance compared to your limit can weigh on your credit while it’s reported. And a payment that’s 30 or more days past due can be reported to the credit bureaus as late.

Read more >> The Importance of On-Time Payments in Building Credit

Bottom line

The ZIP prompt is a fraud check, and the oversized pending charge is a hold that gets replaced by what you actually pumped. If your available credit is tight, paying inside for a set amount keeps the hold out of your way.

The hold never reaches your credit report. What does is your payment history. Kikoff’s Credit Account reports your on-time payments to Equifax, Experian, and TransUnion, with no credit check to sign up. Plans start at $5 a month.