When it comes to debit cards, you have questions … and we have answers.
What is the difference between debit cards and credit cards?
They may look the same, but they are not. With a credit card, you can charge purchases against a pre-approved line of credit. You pay interest on that borrowed money, and pay off your balance in monthly installments. With a debit card, purchase amounts are debited from your bank or credit union account, just like when you write a check. You pay no interest on debit card purchases.
What are the advantages of paying with a debit card?
Debit cards combine the convenience of cash-like access to your money with powerful security features when you buy something or make cash withdrawals. Debit cards let you pay-as-you-go, without worrying about back-end bills or interest charges. And debit cards are a great way to keep track of your spending.
How do I pay with a debit card?
There are a number of ways to make a debit card payment, depending on the type of debit card you have and its features. You have several authorization options, depending on whether you are signing a receipt in a clothing store, buying music tracks online, ordering a pizza or entering your PIN at a terminal to get some quick cash.
What is a PIN-enabled debit card?
With secure PIN-based debit, you enter your personal identification number at ATMs to get cash or manage your account, make purchases at any PIN-equipped retail location and get cash back from many retailers. Your transaction request is processed immediately and is reflected in your account almost instantly.
What is a signature-enabled debit card?
With a signature-enabled debit card, you simply sign a receipt for in-store purchases, just like a traditional credit card transaction. Unlike a credit card, however, with a signature debit transaction the funds are taken straight from your account rather than “borrowing” the money from a financial institution, and the transaction is typically settled in your account within a few days. You can make signature-based transactions at many retailers or service providers that honor major credit cards.
What is a card-not-present purchase?
For online or phone-based purchases, you complete a card-not-present transaction that does not require a PIN or a signed authorization. This is similar to a traditional phone or online credit card purchase, except the funds are debited directly from your checking account.
What is “debit direct”?
Debit cards also offer a quick and easy way to make some regular payments – like your gas or electric bill, rent, mortgage, car insurance or student loan bills – online or over the phone. In fact, a growing number of city utilities, property managers and lenders now let you make automatic debit direct payments from your account. Debit direct can be a smart and simple way to manage your bills.
Can my debit card be both PIN-enabled and signature-enabled?
Sure. Most debit cards carry the logo of a major credit card brand – as well as PULSE or other PIN-based network logos – and are both signature- and PIN-enabled. So you can decide to authorize a purchase by PIN or signature. You must enter your PIN to get cash or access your account at an ATM.
Which type of transaction withdraws money from my account faster?
Both signature- and PIN-based transactions debit money directly from your account. PIN-based transactions debit money almost immediately, while signature transactions are usually reflected in your account within a day or two.
Which type of transaction is the safest?
Any form of payment involves some risk, and all offer certain benefits. A four-digit PIN provides an added level of security. Visit the “Safe and Secure” section of DebitSavvy.org to learn more about the safe, convenient use of your debit card.
Can I change my card type?
Possibly. Call or visit your bank or credit union to find out about features and options on your account.
Are there new developments in debit card fraud prevention?
Yes. Scammers, phishers and other fraudsters are always looking for ways to steal your identity and money. Financial institutions, payment networks and other organizations work constantly to develop and implement measures to protect you and your money. And, resources like DebitSavvy.org help keep you informed about debit card fraud and what you can do to protect yourself. To learn more, visit the “Scam Alerts” section on this website.
What should I do if I think I’m being scammed?
If your debit card has been lost or stolen, or if you notice any unusual activity with your account, contact your financial institution right away. If you think you may have been the victim of identity theft, you should take action immediately. To learn more, visit the U.S. government site at www.ftc.gov.idtheft.
When should I give out my PIN?
The only time you should give your PIN is when you enter it directly on a keypad. Memorize your PIN, and do not write it on your debit card or store it with your card. Never let anyone else enter your PIN for you. No company or individual, not even your financial institution, should ever ask you for your PIN. Never give your PIN during a telephone purchase. Never provide your PIN, debit or credit card number, or any other personal information in response to an unsolicited email.
How can I learn about ATM safety?
The Scam Alert section of this website offers ATM safety guidelines. Review those security tips before driving or walking up to an ATM, and follow those suggestions to ensure your physical safety and the security of your money and account information.
What about online shopping?
Look for secure transaction symbols – such as the lock logo in the lower right-hand corner of your browser and web addresses that start with “https” – when buying any product or service online. Log off the site after making your purchase. If you can’t log off, close your browser to prevent fraudulent access to your account information.
How would I know if my account has been compromised?
Ask your financial institution about their specific account security protections and recommendations. It’s a good idea to keep track of your balances and activity, and to contact your financial institution immediately if you see anything suspicious. The payment industry is now also using “neural networks” to monitor transaction trends and can alert your financial institution to unusual activity regarding your debit card. Transactions are analyzed by amount, type and location. So if you usually make smaller purchases at your local bookstore and grocery market – and charges suddenly appear on your card for expensive meals and electronics 1,500 miles away – those transactions will be flagged. Your financial institution may deny additional purchase attempts until they can contact you to confirm the validity of the transactions.
What else is the industry doing to protect me?
Financial institutions, payment networks and others joined forces to create the Payment Card Industry (PCI) Data Security Standard. The PCI standard calls on merchants and financial service providers to use common, up-to-date security measures to protect you and your money.
If fraud occurs on my debit card, what am I liable for?
The amount you are liable for depends on when you give notice, and other factors. So it’s important you contact your financial institution immediately if your card is lost or stolen, or if you realize your account or information has been compromised.