Debit Card Drawbacks

Debit cards have become extremely popular, mostly because they’re more convenient than writing checks. However, users beware: They do not provide the same liability protection as credit cards. According to a _Chicago Sun-Times_ article, federal regulations limit credit-card holder liability to $50 of fraudulent charges. With PIN-based debit-card transactions, the same $50 limit applies only if fraudulent use is reported within two days. Any later than that and the cardholder’s liability rises to $500 or even higher.
It’s the “PIN-based” part that makes matters confusing. Many debit cards can be used two ways. People can enter their personal identification numbers or they can sign for their purchases. Transactions involving a signature come with the same liability protection offered by credit cards. Debit-card issuers prefer that customers sign for their purchases because that generates more fees from retailers. Retailers, of course, prefer that customers use their PINs.
h3(matt). Matt’s View
p(matt). From a safety standpoint, signing for your debit-card purchases is the better way to go. If you prefer to make PIN-based purchases, it’s a good idea to review your checking account balance fairly frequently to look for fraudulent activity.

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