Debit Card vs. Credit card to combat fraud

Many debit and credit card users do all the right things including protecting their card and keeping their pin numbers secure, but ask the tens of millions of Target shoppers this week if this is enough and the answer will be a resounding ‘no.’ What’s more, some security experts have been warning consumers that they may want to reconsider using a debit card.

According to a new report by CNN, it may be much smarter for consumers to use a credit rather than a debit card. Credit card users may be more protected when fraudulent transactions occur. For instance, if your credit card is hacked, you are protected by federal laws and may not be charged more than $50. Debit cards may not offer the same protection, although some banks do offer fraud protection. Credit companies may also credit the fraudulent charge immediately while debit cards may not make the reimbursement until the charge is investigated by the bank’s fraud department.

For these reasons, many experts have started to recommend that consumers stick to their credit cards. Consider, if your checking account is hacked, not only could it take an extended period of time to have your funds reimbursed, you could have difficulty paying for other bills, including your rent and utilities.

Protecting your debit card and credit card against fraud


But the more important question is how do you protect yourself against fraud, especially when some of the potential abuse is not from your actions but the actions of computer hackers breaching business databases? There are several important steps you can take.

1. Be vigilant and monitor your accounts

The most important advice offered by the experts is to be vigilant and monitor your checking and credit accounts very carefully. If you find a questionable transaction call your bank immediately. Experts note that the habit many consumers adopted of verifying account activity at the end of the month is archaic and inadequate for this fast digital age.

2. Set your own controls to detect fraud

Banks and credit card companies have likely instituted their own fraud detection systems, but talk to your bank about what you can do to protect your account. For instance, you may want to consider having all purchases over a certain limit blocked or verified prior to approval. The benefit of establishing your own controls is you know your shopping patterns better than anyone. If you are unlikely to make a $2,000 purchase, tell your bank.

3. Avoid the most common spots for fraud

Experts also recommend avoiding using your debit card at some of the most common spots for fraud. While this can be hard to know for sure, common places where skimmers have been found are on ATMs and gas station pumps. Others recommend using only credit cards online, especially if the site may be questionable.

What if your debit card is missing? It’s time to report it and have it cancelled. Watching your account may not be enough to ensure it is safe.

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Beth L. is a content writer for Better Bankruptcy. Good content and information is one of many methods we utilize to bring you the answers you need.