Things you should never do with a debit card...
On March 5 I published a Business News article “Keeping Your Credit Cards Safe.” All the rules in that article apply to keeping your debit card safe. In addition, there are a number of things you should never do with a debit card.
Why are more stringent rules necessary for debit cards? The simple answer is that a stolen debit card allows a thief to siphon money from your account. If the loss is not reported promptly the customer can be liable for significant losses, unlike credit cards where the maximum is $50. Even if the unauthorized transaction is reported promptly it can be difficult and time-consuming to get the money back. Consumers would be wise to consider their credit cards the first line of defense against theft of their debit card.
To keep debit cards safe there are some ways they should never be used:
- Paying online. The risk of it being stolen is too high.
- Paying at a gas pump. There are frequent reports of “skimmers,” look-alikes that are installed over the real pump to steal transaction information. The truth is that these fake installations can happen anywhere, but it is easiest to place them in a gas station or in other outdoor locations.
- For car rental. Car rental agencies prefer credit cards because they are a proof of credit worthiness. If the customer pays with a debit card the rental company may run a credit check that has a negative impact on the customer’s credit rating.
- For travel booked in advance. Credit cards offer a cancellation window that a debit card does not. This is also good advice when buying anything for future delivery.
- For recurring transactions. Automatic deliveries require that card information be stored. That creates one more place where the information can be stolen. Never let any organization except your bank store debit card information. And always think twice before letting any business or online service store your credit card information. It’s much safer to enter it for each purchase.
- On a public network. Security is often lax in public networks.
- Any place, like most restaurants, where the card will be out of sight for even a short time.
Debit cards are a wonderful convenience. Many of us consider them safer than carrying cash, but that is not really true. A cash loss is painful, but that is the end of it. If access to the debit card is stolen, all the money in the account is at risk.
So think each time you start to pull out a debit card. Is this a safe place to use it? Would a credit card be safer?
Make it a priority to keep your debit card safe!