Debit Cards and Why You Should Not Use Yours, For Your Own Safety
Recently, the Federal Reserve reported that debit card transactions made by Americans has been growing annually at a rate of more than 20 percent. The debit card transactions have even surpassed the number of credit card transactions processed. Debit cards, being quick and easy to use, have their lure when looking through your pocketbook and making a purchase.
Debit cards are becoming more and more appealing to people as a reliable and easy way to pay for things all the way from computer equipment to a night out for pizza. The appeal of this type of card is obvious.
What is it then that we are all missing about such a seemingly simple product? Why is it that we should NEVER EVEN CARRY AROUND OUR DEBIT CARD!
I’ll tell you and also explain why using a debit card can potentially cost you hundreds and even thousands of dollars. PULSE EFT Association reported in 2007 in it’s Debit Issuer Study that US Financial Institutions lost an estimated $662 million to debit card fraud in 2005. And this is back in 2005. How much hype have you heard about it lately in 2008. It doesn’t look as though the problem has exactly gone away.
When carrying around a card that is linked to your bank account, (WHERE YOU STORE ALL OF YOUR MONEY) you are essentially carrying around your entire cash balance in your pocket. Although cash or credit card seems more risky to some, there is absolutely no reason to think this way.
When losing a credit card, your financial liability when it comes to fraudulent charges placed on your card is limited to $50 thanks to the Truth in Lending Act. That means that once the charges are reported and a “chargeback” is initiated with your credit card company, you are, at most, liable for only $50 of the losses no matter how much the charge may have been.
When it comes to losing cash, you are pretty much limited to the cash you have on hand. Although I can’t imagine the recourse through the police system, haha, or local posters for cash losses are substantial, at least you only lost what you were carrying at the time.
Most people don’t realize the potential risks to their financial reputations were the debit cards to be compromised. And a large percentage of people keep their savings account linked to their checking account, think of the extra loot for the identity thiefs… those lucky guys. And you, the perfect mark, walking around unaware and happily whipping out the debit card for purchases.
Although the Truth and Lending Act helps to protect us consumers, debit cards do not fall under their jurisdiction and instead are regulated by another organization altogether. The Electronic Fund Transfer Act governs debit cards.
To keep the same protection and the limit of $50 for liability, a debit card user has to notify the bank within two business days of the charges. Any longer than two days and your financial liability jumps to $500 and then if you wait more than 60 days from the date of loss, you could lose anything and everything that the thief took.
Not everyone checks their account balances every day and can you imagine losing money in such a silly petty way, simply because it was “easier” to use the debit card. The easy way out is not always the smartest one. Especially when it comes to identity protection and debit card theft.
© 2008 Amy Pedersen, Your Credit Score Secrets LLC.
Author Amy Pedersen is penned as a featured Credit Insider, whose articles provide insider tips and insightful knowledge of the credit industry. Her article topics range from the nature of credit reports to the underlying problems facing credit scoring and the laws which support credit report repair done by the average person.
Consumer Publishing Group has created one of the most comprehensive credit repair manuals available, called The Credit Secrets Bible TM. The Credit Secrets Bible has been in print since 1994 and is absolutely essential if you are serious about fixing or improving your credit. To learn more about Self Credit Repair:
http://www.yourcreditscoresecrets.com More Info
Easy Credit Repair
Or visit our Daily Blog for up to the Date and BRAND NEW information regarding Credit Repair and Raising your Credit Score now:
http://www.yourcreditscoresecrets.com /blogCredit Score Secrets Blog
