One thing you can bet on is that you’re going to run across a lot of things to buy this year, from food to smart TVs and other devices. How you pay for those things will be very important.
In this article, we’re going to talk about why you should stop using your debit card to pay for things online.
But first, let’s go over the scenario: You shop online or run inside the grocery store to pick up a few things and at checkout, you pull out your debit card and proceed to swipe — but here’s why you shouldn’t.
Why You Should Never Use A Debit Card
For starters, hackers are actively trying to get your money, especially if you store it on websites and other places that may be high risk.
- It’s Harder To Get Refunds: If you’re in the habit of paying for things you buy online with a debit card, it may take you much longer — if ever — to get your money back if there’s a problem.
- Debit Cards Don’t Protect You From Fraud: Credit cards have more fraud protections than debit cards. That’s not to say that debit cards are useless, but if you’ve been defrauded, your money’s usually gone.
To help you understand the distinctions between the two, let’s look at credit cards and debits cards for what they are and how they differ.
What’s The Difference Between A Debit Card And Credit Card?
Debit cards and credit cards are two entirely different forms of payment. The only similarities they have are that they’re both plastic cards.
What Is A Credit Card?
A credit card allows you to borrow money directly from your bank. When you swipe your credit card, you automatically create an account balance that you should pay at the end of the month.
A credit card is backed by the bank or card issuer. That means they have many safeguards in place to protect their product, and you — the cardholder — benefit from that.
What Is A Debit Card?
A debit card is a card that allows you to spend money from your bank account. The amount that is deposited into your account is how much purchasing power you have at any given time.
One convenience of a debit card is that you can access money practically from anywhere by using an ATM.
Is It Bad To Use A Debit Card?
Generally, when making purchases you have more protections with a credit card rather than a debit card. For instance, if you get swindled due to buying a defective product, a credit card issuer typically will refund you the money even before it recoups it from the product seller.
On the other hand, if you use a debit card to buy a defective product, that money is generally not refundable. The bank doesn’t have any incentive to fight for your money.
Bottom Line
It seems like every week there’s another data breaches or cybersecurity incident. It’s a wonder that more people aren’t afraid to pay online with a debit card.
It seems like every week there’s another data breaches or cybersecurity incident. It’s a wonder that more people aren’t afraid to pay online with a debit card.
So the next time you shop at an online store, remember to pull out your credit card, not your debit card.
Again, this is not to say that debit cards serve no purpose, but remember that they only have as much power as what you have in your account.
A credit card, on the other hand, has the card issuer on the hook as well, so they have protections built in to safeguard their investment as well as yours.
Interested in other ways to save or make money? Check out our Money Section:
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