Payments with a debit card are taken instantly from your checking account and shopping online comes with the added risk that your information may be stolen. Using a debit card opens up the possibility that the thief will gain access to the funds in your checking account.
Debit Cards make transactions fast, easy and convenient to use. Debit Cards have the ability to give you cash. They double up as ATM cards and allow you to withdraw money from an ATM.
Credit cards often offer better fraud protection
With a credit card, you're typically responsible for up to $50 of unauthorized transactions or $0 if you report the loss before the credit card is used. You could be liable for much more for unauthorized transactions on your debit card.
Convenience. Debit card payments allow you to complete transactions without having to fumble for cash, dig around in your purse or pockets for exact change, write out a check or go to an ATM. And with more and more businesses now offering the option of debit card payments, it's more convenient than ever. Security.
Call — or get on the mobile app — and report the loss or theft to the bank or credit union that issued the card as soon as possible. Federal law says you're not responsible to pay for charges or withdrawals made without your permission if they happen after you report the loss.
EFTPOS (or Electronic Funds Transfer at Point of Sale) is a convenient way for customers to pay using one of many payment methods – usually debit or credit cards, mobile phones, smart watches, or other wearables.
Even if you've taken precautions, debit card fraud can still happen. If your card gets hacked, don't panic. Tell your bank or credit union right away so you won't be held responsible for unauthorized charges, and file a complaint with the Federal Trade Commission.
Debit card fraud occurs when a criminal gains access to your debit card number—and in some cases, personal identification number (PIN)—to make unauthorized purchases or withdraw cash from your account.
Fraudsters can still use your debit card even if they don't have the card itself. They don't even need your PIN—just your card number. If you've used your debit card for an off-line transaction (a transaction without your PIN), your receipt will show your full debit card number.
You'll avoid a big bill, late payment fees and interest.
Because you'll only spend what you have, there's no massive bill shock to worry about. Plus, you'll do your credit score a favor by avoiding late payments and interest on credit card balances carried over from month to month.
The bottom line
It's best to use credit only for products and services that won't charge a fee, and using cash, debit or bank transfer for the rest. And, of course, use a credit card only if you know you can pay off the balance each month.
Fraudsters can get ahold of your card details in a few different ways—one of them being through an ATM card skimming device. Nefarious parties can also gain access to old bank statements or debit cards, or direct you to make a payment on a fraudulent website that collects your details.
Consumers who use debit cards are protected by the Electronic Funds Transfer Act (EFTA). This law lays out the liabilities of the consumer as follows: If a lost or stolen debit card is reported to the financial institution before any fraudulent purchases can be made, the consumer faces no liability.
There's no rule against having multiple debit cards, though having more than one checking account makes your financial life more complicated. Just make sure your main debit card and checking account — the bread and butter of your banking life — work for you.
Visa Debit cards do the same thing as a prepaid or debit card but can also be used like credit cards. They pull funds from a customer's bank account like a debit card, so they are linked to their financial institution. In all three cases, you cannot access borrowed money or have access to a credit limit.
Safeguarding your identity and personal information
You should avoid keeping unnecessary items in your wallet. Instead, you should stick with only essential items like your driver's license, credit cards, debit cards, and health insurance cards. Learn more about how you can protect yourself from identity fraud.
Banks Make Money With Interchange Fees
You buy something for $100 with your debit card. The small business or store would pay an interchange fee of $2.15. The store keeps $97.85 of the purchase price, and the $2.15 interchange fee goes to the bank that provided you with the credit or debit card.