Introduction
Overdraft is a recurring theme in the financial sector; banking and other financial institutions too many times deal with the issue of overdraft daily (day-to-day transactions). Overdraft is not limited to B2C (Business to Customer) alone; B2B (Business to Business) can overdraft in their business transactions.
Anyone can overdraft, including merchants, clients/customers. In the government sector, the government of a country can overdraft, government agencies can overdraft, and non-government agencies can overdraft, too. Overdraft is not limited to a particular group of persons or organisations. Now, let us look into the meaning of overdraft, a recurring term in the financial sector.
Now, can you overdraft the DoorDash Direct Card?
The short answer is NO. DoorDash launched DoorDash Direct so that Dashers would not have to worry about overdraft fee charges or the minimum requirement of a deposit. It launched the mobile banking app to enable Dashers to monitor their banking activities and make the best choice accordingly. We will discuss this in detail subsequently. Meanwhile, what is DoorDash?
DOORDASH ORGANISATION
Brief History:
DoorDash is an American company founded by three students of Stanford University, Stanley Tang, Andy Fang, and Tony Xu, in the year 2013 and had the name paloaltodelivery.com, Palo Alto, California. In the same year, June 2013, it was incorporated as DoorDash.
Currently, DoorDash is headquartered in San Francisco in California, United States of America. The company is into online food ordering and food delivery services. According to DoorDash statistics, it has over twenty million consumers, a million deliverers (officially called Dashers), and more than five hundred thousand merchants across different countries.
Career with DoorDash
As an international organization, career opportunities are open for delivery agents in several countries where DoorDash operates. Such countries of operation include the United States, Canada, Australia, Japan, Denmark, Italy, Greece, Romania, New Zealand, Croatia, and Turkey.
Becoming a Dasher: To become a DoorDash Dasher (delivery agent) is quite simple (the process is quite simple). Visit https://www.identity.doordash.com and sign up with your verifiable personal details. You will be notified if your application is successful.
Partnering with DoorDash: DoorDash has over five hundred thousand merchants on its network and is still expanding to sign up more. Partnering with the company to become a merchant is a smooth experience. For a start, there is a 0% commission charge in the first month of becoming a registered merchant. You could partner to offer online ordering, delivery, and pickup to customers on the DashDoor network.
If your business is running restaurants, grocery stores, convenience stores, wine, pet stores, flower shops (flower arrangement, planting, etc.), Liquor stores, or retail, you will find a market platform on the DoorDash network. You can get feedback from customers, too, through this partnership. For more details, visit https://get.doordash.com/en-us.
DoorDash cuisines: Local and international cuisines are available for ordering on DoorDash. Cuisines such as pizza, Italian cuisine, sushi, seafood, Indian cuisine, desserts, burgers, Asian cuisine, vegan, sandwiches, Chinese, Mexican, and Thai cuisines. Charges for orders are between $1+ and $5+ delivery charges.
DOORDASH FINANCIAL SYSTEM
DoorDash operates three notable financial systems.
- DashDirect: This is a mobile banking app (powered by Payfare®) launched by DoorDash to make the banking experience smooth for Dashers. Dashers are issued a DasherDirect Business Prepaid Visa Card (issued by Stride Bank) to enjoy debit account mobile banking.
- Direct Deposit: Every Dasher has an account with DoorDash where payment for assignments completed is deposited. The system charges no deposit fee, and Dasher gets paid immediately for every dash completed.
- Cash Back: DoorDash has a system of paying up to 10% cashback on gas purchased by Dashers anywhere, at any time, and at any filling station.
What is Overdraft? In a simple (non-technical) definition, an overdraft is withdrawing more money or spending more money than you have in your bank account (from the perspective of banking institutions). In non-banking institutions (other financial institutions), it means the same thing (spending more than you have with the organisation). If it involves issuing a cheque or money order as a way of payment, it means ordering the bank to pay more money than you have in your bank account.
It is interesting to note that some banks and financial institutions make provisions for their customers to overdraft and then subsequently pay back per the agreed terms and conditions. Unfortunately, your overdraft privilege can be cancelled anytime if you default in paying as at when you suppose upon—per the agreed terms and conditions.
Reasons for Overdraft: There are no empirical reasons why people, merchants, institutions, etc., overdraft, so it is peculiar to the person or organisation. However, some of the reasons why overdraft occurs include:
- Taking a loan: the client is short of money and knowingly makes an insufficient fund debit while accepting the associated overdraft charges and paying the overdraft at the next deposit.
- Bad account record keeping: The client fails to properly keep a record of his or her account activities (knowing the balance before spending or withdrawing) and subsequently overspends.
iii. Automated Teller Machine error: Sometimes an ATM may allow overdraft (withdrawing money despite insufficient funds) while the owner of the account may or may not be aware. This is possible due to several reasons that might be a result of network glitches. If the ATM cannot communicate with the account owner’s bank, it could automatically authorise a withdrawal based on the limit set by the authorizing network (the paying bank).
- Trader error: In this scenario, overdraft occurs when the trader mistakenly debits the customer’s account due to human error. For example, a customer can make a purchase of $10, which may be debited as $100. The client in this situation has the option of recovering these funds through a chargeback.
- Chargeback to the trader: A trader’s account can receive a chargeback because of a debit or credit card error charged to a client. The chargeback and the fee associated with it could likely leave insufficient funds to cover another withdrawal.
- Account Holder floating: In this situation, the account holder makes a debit with insufficient funds in the account in the hope that he/she will be able to deposit before the debit clears. This is common with payment through a cheque.
vii. Bank charges: An unexpected bank charge to the account of a client could create a negative balance, thereby leaving insufficient funds for a subsequent debit from the account.
viii. Bounced cheque: The account holder makes a cheque deposit or withdrawal, and the cheque is returned due to insufficient funds, a wrongly issued cheque, a closed account, a forged or stolen cheque, or a result of this chargeback and associated fee leads to overdraft.
- Banking error: In this situation, a cheque debit is posted despite the incorrect amount due to human or computer error. So the amount removed from the account can be different (larger or smaller) than what the account holder intended. This scenario could work in both ways; it could work against the account holder or the bank.
- Fraud: Intentional fraud can also lead to overdraft. In this case, an ATM deposit with the wrong fund is made or a cheque (or money order) with an incorrect amount or bad order is deposited by the account holder intentionally, in the hope that he/she might get away with it before the fraud is detected. This subsequently leads to an overdraft fund (deposited or withdrawn) before the fraud is detected. This fraud could be perpetrated by anybody against one’s account, another person’s account, or a third party’s account.
As mentioned earlier, the reason for overdraft varies and is numerous. These are some of the reasons stated above.
Conclusion:
Can you overdraft the DoorDash Direct Card? No, you can’t overdraft. Since the launch of the DasherDirect app (mobile banking), Dashers can now check their account balance, set up financial goals, pay bills, and make a transfer without anxiety over overdraft fees.
To top up the smooth experience, with DirectDash, you get about 2% cashback on every gas you purchase everywhere and anytime. You also enjoy free deposit and free withdrawal, and likewise, get paid once at the end of every delivery you complete.
FAQs
- Does the DashDirect card have banking functionality?
Ans: Yes, it does. DashDirect card is a Visa card issued by Stride Bank and accepted by over twenty thousand ATMs on the Visa® network. There are no charges if you use it on Automated Teller Machines. Moreover, you can use the card to pay bills, make a deposit, and send funds.
- Why Business Card?
Ans: DoorDash takes you as a business contractor since you manage the delivery business on your own, hence the Visa Business Card, which is accepted on the Visa network worldwide.
- What personal information is needed to apply for the DashDirect card?
Ans: Personal information required includes your full name, date of birth, a copy of your driver’s license, your social security number, and your home address.
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