Can It Be Dangerous to Use a Debit Card?

You might love your debit card, because it provides you with an easy way to pay for purchases straight from your checking account. There are no interest charges, but no checks to write, either. Yet, there are some situations in which you should still use a credit card, due to the way card fraud is handled by banks.

If your card information is stolen, your checking account could be drained before you even realize what has happened. And with debit cards, you must report the theft right away, or you could be liable for up to 500 dollars in fraudulent charges. On the other hand, credit card companies allow you a much longer time period to dispute charges, and you won’t be responsible for any charges which are made fraudulently.

At the pump. Your card information can be stolen at the gas pump, due to a scam called skimming. Thieves place tiny card-reading devices inside the card slot, and these devices record your card information. Later the criminals return, collect their devices, and have access to numerous debit and credit card numbers.

Online purchases. Online shopping is generally quite safe, particularly if you are careful to observe certain safety rules. But it is possible that your card information can be hacked and stolen, or that an item will arrive that does not meet your expectations. A credit card will offer you better protection in either of these circumstances.

Large purchases. Your card number isn’t more likely to be stolen this way, but your credit card may offer protection on large purchases. If you need to return a defective item but the vendor refuses the return, you can dispute the charge with your credit card company. Your company may even offer extended warranties on some expensive items.

Restaurants. When you pay for a meal at a restaurant, often your card will leave your sight for a brief period of time. Occasionally we hear of cases in which dishonest servers record customer card numbers, and later use those numbers to make fraudulent purchases. As you have already learned, credit card companies offer better protection against such theft.

Deposits on services. Any time you rent a car, stay in a hotel room, or hire a moving truck, the final bill is not yet determined. Using a debit card can result in a “hold” on funds in your checking account, which in some cases has caused difficulty for customers. Use a credit card, and the charge will appear as “pending” until the final charge is entered.

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