Debit Cards Safety May Not Compare To Credit Cards

This holiday shopping season, more consumers are planning to use budget-friendly options such as cash and debit instead of credit cards.

Debit card usage in particular has been on the rise in recent years, and reports show the payment method is only increasing in popularity as consumers look to avoid debt.

In 2009, debit cards surpassed credit options in popularity. Eighty percent of consumers now have a debit card, and outnumber credit users by 2 percent, according to USA Today. In addition, recent polls have found 70 percent of Americans are likely to use debit for holiday purchases.

However, new reports suggest debit may be disadvantageous for some payments. Losses from fraud relating to debit transactions totalled more than $780 million in 2008, up from $662 million in 2005, USA Today reports.

Consumers may wish to compare credit cards to debit for purchases as using the former can offer extensive consumer protection.

Both options may offer zero liability coverage, which promises to reimburse consumers when a card is compromised. However, not all debit transactions are covered by the policies. Claims can be waived if cardholders file too late, or behave irresponsibly. This can be defined as sharing a PIN number, or other information that could have enabled fraud.

Even those debit users with coverage may have to wait for their reimbursement, the news source says. This presents a problem for those who sustain themselves paycheck to paycheck. This could lead to missed payments on bills for rent, heat, electricity and credit cards.

Defaulting on the latter could even damage a consumer's credit score. By comparison, credit card holders are able to access more funds during a dispute.

While the cards are issued by the same lenders, both payment types are now covered under different consumer protection laws. Credit cards fall under the Fair Credit Billing Act, which limits liabilities. Experts consider this policy to be more extensive and offer more protection than the Electronic Fund Transfer Act, which covers debit and ATM withdrawals.

Credit cards also offer consumers more online safety the news source says. This is because of the coverage and many other buyer protections that could limit liabilities for less secure transactions.

Because of this, many consumers may wish to compare credit card offers this holiday season in order to take advantage of protection policies and new rewards, which could help with winter shopping.

by:Pete Miller

POST COMMENT

Safety measures to be undertaken by Plumbers Safety and workwear clothing Pharmaceutical equipment quality and safety market access should be implemented - the pharmaceutical, equipment, medicine machine - pharmaceutical Operational Risk Management: Ensuring Safety For Food Systems - Webinar By Globalcompliancepanel Coast To Coast AM Radio Show For Nov 8th/9th Featuring Leading Futurist John L Petersen Of The Arlington Institute! Knowing More about Laser Pointers Helps Our Purchase and Safety Use Safety Tips for Home Emergency Lighting Digital display Radio Kchibo DSP D39L FM/SW/MW Top Tips On How To Choose A HDTV From An Electronics Website Volvo S40 C30 C70 V50 factory OEM dvd player gps tv AM FM CD MP3 radio Probe Personal Lubricant In Review Power Management Integrated Circuits (ic) Market To 2020 Aarkstore Enterprise Shenzhen Industrial Fair 2009 exhibitors Summary - electronics industry