Debit Card Safety

Image of a finger over the keypad of an ATM machine“And how are you paying for your purchases today?”

It’s a question we have to answer almost every day. Will you be using cash, a credit card or a debit card?

It may be instinct for you to pull out any piece of plastic without thinking, but your random card of choice might not be the safest way to pay. Sometimes, you’ll want to use a credit card. And sometimes, its a better idea to pay with a debit card. Still other times, you’re best off using cash.

Let’s explore when and how to use your debit card.

Credit and debit: How are they different?
They’re both plastic, with a series of numbers, a security code and your name embedded on them. So, how are debit and credit cards different?

A better question might be: How are they the same? Appearances aside, your credit and debit cards have very little in common.

Credit cards allow you to choose your purchases now, and pay for them weeks, months or even years later. If you let your balance grow, you’ll be paying for a lot more than it really costs in the way of interest. But, if you make timely payments, you’ll have yourself a small loan that usually costs you1 little to nothing. Credit cards also offer rewards, purchase protection and the ability to back out of a purchase you’ve decided against. You can also contest fraudulent charges on your account, freeze your credit on a compromised card or even close the card completely.

Debit card transactions, on the other hand, take the money right out of your checking account as soon as you swipe. Some point of sale terminals put a freeze on the amount, removing it from your account a few days later. But, either way, you won’t be able to access that money and you won’t have to worry about paying for it later. There’s no interest here, but there also may be no purchase protection, depending upon your financial institution. Finally, in case of fraud you may need to resort to closing your checking account. However, usually a simple issuing of a new debit card is all that’s needed.

Which one’s better? It depends on the purpose. Debit cards are great for helping you stick to your budget and won’t send you into a cycle of debt. However, because they may offer very little recourse in cases of fraud, credit cards are usually the better choice in the most vulnerable situations.

5 purchases you should carefully consider before using your debit card
According to data from FICO, during the first 6 months of 2017, the number of compromised ATMs and point-of-sale devices was 21% higher than it was in the first 6 months of 2016. Don’t let your card be next!

Here’s where you may not want to use your debit card:

1.) At the pump
Card skimmers at gas stations are on the rise. By choosing to use your credit card instead of your debit card at the pump, you’ll have an added layer of protection against fraud. You can also choose to use cash. It’s the safest way to pay (so long as you watch out for pickpockets!).

2.) At an isolated ATM
The ATM at AOCU? Definitely safe to use.

The one at the crowded pharmacy? Probably OK.

The machine in a secluded corner of an empty convenience store? Very possibly tampered with.

Isolated ATMs in locations with very little security and sparse foot traffic are prime targets for hackers. It’s best to give these machines a wide berth and pick up your cash at AOCU.

3.) In an unfamiliar location
When on vacation, it’s important to think before you swipe. You don’t know the area and you can’t be certain which clerks are to be trusted. You’re better off paying with a credit card or with cash so your purchases are protected against fraud.

Also, a large charge in an area you never frequent might cause your purchases to be flagged as fraudulent. Let your credit union know about your trip and be careful how you swipe!

4.) For large purchases
If you’re springing for a new entertainment center or another big-ticket item, you’re best off using your credit card. It’ll offer you dispute rights in case the product doesn’t turn out how you expected, and you might be granted an extended warranty just for using a credit card.

5.) Restaurants
Can you really trust the servers at your favorite restaurant with your personal financial information? When you hand them your debit card at the end of the meal, that’s exactly what you’re doing. The server has more than enough time to clone your card and then use it for any purchases they’d like to make. Unless your restaurant has a tableside payment system, you’re better off using a credit card or cash to pay for your meal.

Debit Card Safety
Always use caution when using your debit or credit card. Check the payment processor for anything that looks out of place, such as a newer keypad on an older machine, or a hard-to-use slot for your card. Don’t forget to cover the keypad with your hand when inputting your PIN.

Stay ahead of hackers by using your debit card with caution!
Your Turn: Was your debit card ever compromised? Share your experience with us in the comments!

SOURCES:

https://budgeting.thenest.com/problems-using-debit-cards-gas-pumps-23710.html

https://www.creditcards.com/credit-card-news/10-places-not-to-use-debit-card-1271.php

https://www.creditcards.com/credit-card-news/gas-pump-atm-skimmers.php

http://news4sanantonio.com/news/local/skimming-devices-found-on-pumps-at-northwest-side-gas-station

Traveling with Cards

The last thing you think about doing as you’re getting ready to leave for a trip is calling the credit union. It may seem like an odd thing to do, but it really is something that should go on your to do list before you leave for any trip. The reason is that it can help ensure that your debit and credit Cardscards will work when you reach your destination.

The geographic area where your card is active is something that is tracked. When card purchases suddenly show up across the country, or in areas that are far away from where you usually make purchases, it can appear as if your card has been compromised. When atypical card usage is noted, an alert is generated, and many times a hold will be placed on the card. Then we have to get in contact with you to confirm that you were the one making the purchases before regular usage of the card can resume. Obviously that can be a major inconvenience for you, which is the last thing you, or we, want to have happen, especially while your on a trip.

Fortunately, this whole situation is easily avoided by a making a quick phone call. Simply let us know when you plan on using your card far from home and we’ll note it. That lets us protect your account and makes sure that you can use your card when and where you wish without any annoying interruptions.

This leads into one other important habit that you should get into with everyone that you have a card from. That habit is to make sure that your contact information is accurate. In the event that we do receive an alert and put a hold on your card, we need to know how to get in touch with you. So, the next time you’re in one of our lobbies, simply ask to have the teller review the contact information on file. Or give one of our friendly call center reps a call. Any of them are happy to update your information so that we can get in touch with you in case of emergency.

Finally, it’s also always a good idea to have at least a bit of cash, or traveler’s checks, on hand in addition to any cards you may plan on using. That way, if something does happen, whether it’s a disabled or broken card or simply non-functioning ATMs at your destination, you’re covered. Following these simple tips can make traveling a lot less stressful and ensure that you have a good trip.

We love to get feedback from our readers, so feel free to comment. We’ll do our best to answer any questions you may have. Got a topic you’d like us to cover? A question that you’d like to have answered? Comment or shoot us an email!