4 Places You Should Never Use A Debit Card

Most of our posts are written with the business owner in mind. This post however is geared towards card holders. We believe it’s still educational for business owners.

Debit cards are different.

And fraud is on the rise.

As told by BankRate.com:

Would you give a thief direct access to your checking account?No? Unfortunately, you may be doing just that by regularly using your debit card. Debit cards may look identical to credit cards, but there's one key difference. With credit cards, users who spot fraudulent charges on their bill can simply decline the charges and not pay the bill. On the other hand, debit cards draw money directly from your checking account, rather than from an intermediary such as a credit card company.

In other words, the harm to a credit card holder is relatively small if their card is compromised. You contact the issuer to report false charges and after some paperwork you’re done. The money never leaves your account. Debit card fraud however is different. Money DOES leave the account. And you have to fight to get your money back. Unfortunately it’s now taking longer and longer to get that money back. What if you had no money to pay your mortgage? To buy gas or food for your family?

Debit cards should only allow you to spend what you have - which is why they can be helpful to control spending money that you don’t have. However the problem comes if the crooks crack the code to your debit card.

According to BankRate.com, there are 4 places you should be cautious of using a debit card at all costs:

1. Independent ATMs

"The idea that outdoor ATMs are among the most dangerous places to use a debit card seems a little bit absurd. But some ATMs present a perfect opportunity for thieves to skim users' debit cards, says Chris McGoey, a security consultant based in Los Angeles."

2. Pay at the pump

"You go to a gas station and you stick your debit card in there, and you swipe it through a machine," Abagnale says. "I'm sitting across the street with a laptop and an antenna. I put a skimmer in there, and I'm picking up all the information. Before you even get home, I've debited your account."

3. When you're buying online

"Online is the No. 1 place where consumers should not use their debit cards," she says. "It's susceptible at so many points."

4. At a restaurant

"Any place where the card is out of hand" can increase the chances of fraud, says McGoey. "The guy comes to your table, takes your card and disappears for a while, so he or she has privacy," giving the person the opportunity to copy your card information."

If you are someone who would be financially devastated if your bank account were emptied, one idea is  to open a second account and tie your debit card to it. Then fund the second account only with money that's used for debit card activity, so your principal account won't be at risk in the event of a breach. What are your thoughts on debit cards vs. credit cards?