Law kicks in on debit card use in lot­tery

Northwest Arkansas Democrat-Gazette - - NORTHWEST ARKANSAS - MICHAEL R. WICK­LINE

BRYANT — For now, the owner of the Arkansas Schol­ar­ship Lot­tery’s top-sell­ing re­tailer is hedg­ing his bets on debit cards.

A sign near the cash reg­is­ters at Y&E Su­per­stop along In­ter­state 30 in Bryant states, “No debit cards for lot­tery.”

The store’s owner, Ed­die Park, is among a few of the lot­tery’s top-10 ticket-sell­ing re­tail­ers who said they’ve not yet de­cided whether to ac­cept debit cards for lot­tery ticket pur­chases, al­though a state law giv­ing more than 1,900 re­tail­ers the op­tion went into ef­fect Tues­day.

“We are go­ing to hold it for a while [and] see what every­body else is do­ing,” Park said, adding he’s no rush to make a de­ci­sion.

The law au­tho­riz­ing lot­tery re­tail­ers to ac­cept debit cards, Act 876 of 2017, also al­lows re­tail­ers to ac­cept other “non­cash, non­credit method of pay­ment” such as Ap­ple Pay and Google Wallet.

It makes the re­tail­ers who ac­cept these pay­ment meth­ods responsible for any costs, fees or charge-backs that go with the trans­ac­tions. Credit cards and checks are still pro­hib­ited for lot­tery ticket pur­chases.

Park, whose store has been the top seller for the past three fis­cal years, said the fees card com­pa­nies charge on each debit card trans­ac­tion is among the fac­tors that will weigh into his de­ci­sion.

Some re­tail­ers said the fees charged to stores may range from 30 cents to 60 cents per trans­ac­tion.

A hand­ful of Y&E Su­per­stop cus­tomers in­ter­viewed Tues­day af­ter­noon said it doesn’t make a dif­fer­ence to them whether the store be­gins ac­cept­ing debit cards on their ticket pur­chases.

“I think that’s their own pref­er­ence. It costs them money,” said a woman who de­clined to give her name as she gath­ered dozens of dis­carded lot­tery tick­ets from a trash bin out­side the store.

Wil­lie Ea­son of Bryant, a re­tired An­heuser-Busch ware­house worker, said “I don’t use any debit card be­cause I would spend too much money.” “I would be broke,” he said. Park’s store sold $2.18 mil­lion in tick­ets in fis­cal 2017, which ended June 30.

The lot­tery re­ported rev­enue of $449.9 mil­lion for 2017 and re­ported rais­ing $85.2 mil­lion for col­lege schol­ar­ships.

Lot­tery Di­rec­tor Bishop Woosley, un­cer­tain whether use of debit cards will boost rev­enue, has pro­jected 2018 lot­tery rev­enue of $459 mil­lion and net pro­ceeds for col­lege schol­ar­ships at $83.6 mil­lion.

The lot­tery has helped fi­nance more than 30,000 Arkansas Aca­demic Chal­lenge Schol­ar­ships each of the past seven fis­cal years.

Lot­tery re­tail­ers, such as Park, are weigh­ing the com­mis­sions the lot­tery pays them and any ad­di­tional busi­ness that can re­sult from ac­cept­ing debit cards for lot­tery ticket pur­chases against the cost of the debit card trans­ac­tion fees.

Each lot­tery re­tailer re­ceives a “base com­mis­sion” of 5 per­cent of sales of scratch-off tick­ets and of tick­ets for draw games such as Power­ball, Mega Mil­lions, Cash 3, Cash 4 and the Natural State Jack­pot.

The re­tailer also gets a “cash­ing com­mis­sion” of 1 per­cent for each dol­lar in prizes re­deemed by cus­tomers. Re­tail­ers are re­quired to re­deem prizes up to $500.

Each also gets a “sell­ing com­mis­sion” of 1 per­cent of a prize amount of $10,000 or more on each ticket val­i­dated and paid to a player. The sell­ing com­mis­sion is lim­ited to $50,000.

Un­der the lot­tery’s rules, each re­tailer also may re­ceive a com­mis­sion of up to 10 per­cent on “spe­cial games” au­tho­rized by Woosley. The lot­tery’s sec­ond-ranked top-sell­ing re­tailer, Free­way Mart near the in­ter­sec­tion of Base­line and Chicot roads in Lit­tle Rock, started ac­cept­ing debit cards on lot­tery ticket pur­chases Tues­day, said man­ager Bongil Ko.

Ko said he doesn’t like hav­ing to pay the card com­pa­nies’ fees on debit card trans­ac­tions, but he “just doesn’t want to lose the cus­tomer.”

The lot­tery’s third-ranked top re­tailer, To­bacco Cor­ner Plus in Mor­ril­ton, also started ac­cept­ing debit cards for lot­tery pur­chases Tues­day, but it’s charg­ing a 2 per­cent fee on the pur­chases to help cover the cost of card trans­ac­tion fees, ac­cord­ing to a store em­ployee.

The fourth-ranked, Wild­wood Shell in Sher­wood, is ac­cept­ing debit cards for lot­tery ticket pur­chases, said Ni­cole End­s­ley, store man­ager. One woman bought $200 in lot­tery tick­ets there us­ing her debit card Tues­day.

“It makes it a lot eas­ier. It doesn’t hold up the line be­cause they have to have cash,” she said.

The fifth-ranked lot­tery re­tailer, Kwick Check III on Geyer Springs Road, is ac­cept­ing debit cards only for lot­tery ticket pur­chases of at least $20, said store owner Yun Lee.

Murphy Oil USA, the chain with the sec­ond-most lot­tery out­lets, is ac­cept­ing debit cards, said Jer­ri­ane Thomas, a spokesman for the El Do­rado-based com­pany. Murphy Oil USA has 69 lot­tery out­lets in Arkansas, ac­cord­ing to the lot­tery.

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