Debit Cards Riskier, Needs More Vigilance From Card Holders

As more and more consumers move away from credit cards and use debit cards instead, the problems associated with debit cards become clearer and clearer. Since credit card companies have made credit much more expensive and riskier for consumers, many have turned to debit cards instead.

Debit cards work very much like credit cards, only that the transactions that a debit card approves are covered not by a mini loan, like in credit cards, but by the deposit in a linked bank account. Thus, debit cards are lauded for saving card holders from interest fees, one of the heaviest baggages that credit cards bring. There are also other benefits that debit cards bring but, with all these benefits, many industry watchers also consider debit cards to be riskier than credit cards.

Undoubtedly the biggest risk of using debit cards is that it does not carry the same kind of protection that credit cards carry. A large part of this is because debit cards use money directly, not loans like credit cards do. When a debit card gets stolen and it is used to buy items illegally, card issuers cannot easily stop payment as easily as they can with credit cards.

Although a lot of card issuers may market debit cards saying they have the same kind of protection as credit cards, a thorough look at the fine print would show that it isn’t so. It is therefore very important for debit card holders to keep a close eye on their debit cards, especially during the shopping frenzy of the holiday seasons.

A good strategy to keep debit card problems at bay during the season is to carry only the card that is needed. Pickpocketing becomes a huge problem when the holidays are in. Debit card holders should also always keep their cards in sight. This means that debit cards should not be used for restaurant payments where they are usually taken away by the waiter when paying. Even if the transaction is done in front of the card holder, they should still make sure that nothing suspicious is going on such as multiple card swipes. When the debit card is given back, card holders should also make sure that the card that they are getting is their own.

Fraud is quite difficult to prevent, as evidenced by the many instances of fraud that happen every year. The best that debit card holders can do is to detect it as soon as it happens. If card holders detect anything suspicious, they should immediately inform their debit card issuer right away.