Having a debit card can provide countless benefits, like allowing someone to make cashless purchases without the worry of acquiring any debt because people can only spend the money available in their bank accounts.
Using debit cards can also increase a person's safety when making big purchases as they don't have to carry a hefty sum of cash with them.
However, the frequent use of debit cards isn't all good. It also poses risks – and debit card fraud is one of the biggest and most common.
Debit card fraud can have long-lasting and adverse effects on a person and can result in lost funds and a stolen identity. Read on to discover how to prevent debit card fraud from happening.
What Is Debit Card Fraud?
Debit card fraud is a type of fraudulent activity wherein a criminal gains access to another person's debit card number and personal identification number (PIN) and uses these details to make unauthorized withdrawals and purchases.
There are countless ways that criminals can access or steal another person's debit card information. They can do it by hacking into a retailer's unsecured network or computer to find the data, photocopy receipts, or install a skimmer to store victims' card numbers.
Some criminals are even stealing other people's debit card information by intercepting their mail or stealing their debit cards.
With the advancement of technology, cases of debit card fraud have become more and more common today. Most victims don't even notice that their debit cards are being used until their bank accounts reach zero.
What Is the Difference Between Debit Card Fraud and Credit Card Fraud?
Debit and credit cards are two of the most common payment methods used by individuals in different parts of the globe today. These cards provide convenience and safety as shoppers no longer have to carry cash or regularly look over their shoulders.
But just like with debit card fraud, the use of credit cards frequently can also make someone susceptible to fraud. Credit card fraud can also have adverse effects on a person's life and can even cause them lifelong debts.
However, the two are different in several ways:
- When debit card fraud occurs, cash comes out straight from a person's bank account, because criminals can easily swipe the card and use it for their purchases. Cases of credit card fraud don't happen in the same way because fraudulent charges are included in the victim's credit card statement, but no money leaves their accounts.
- Victims of credit card fraud will also have to pay their bills every month, even if they're not the ones using their cards.
- Debit card fraud and credit card fraud also have different processes when it comes to recovering losses. When credit card fraud happens, the card provider will work on recouping any financial losses. With debit card fraud, on the other hand, the account holder or victim will be responsible for getting their cash back.
How Can You Prevent Debit Card Fraud?
Debit card fraud can adversely affect a person's life as their money will go missing from their bank account almost instantly, and they might not be able to afford to pay for their necessities.
Debit card fraud will also cause checks to bounce, which can damage or stain the reputation of the account owner.
Banks worldwide will always accept complaints on debit card fraud, but restoring or returning a person's stolen money because of the activity isn't always guaranteed.
In some cases, victims will have to spend months chasing up the incident and providing the necessary documents only to later find out that their money can no longer be retrieved.
Being a victim of debit card fraud can be traumatizing, which is why anyone who has and uses a debit card should prevent such situations from happening.
Here are seven tips to prevent debit card fraud:
1. Regularly Check Bank Activities
Online banking is a common service offered by almost all banks today. By simply downloading an app and inputting a username and password, anyone can check the balance of their accounts in real-time.
Aside from the convenience, maximizing online banking features is also a great way to prevent debit card fraud.
Through online banking, anyone can see whether another person has been using their debit card for unauthorized purchases and if a certain amount of money has been deducted from their accounts, even if they're not using it.
Spotting anything out of the ordinary should prompt the account owner to call their card issuer or bank right away. The owner can choose to cancel their cards to prevent criminals from stealing more money from their account.
2. Set Text Alerts for Debit Card Transactions
Along with online banking, setting text alerts of debit card transactions can also help prevent fraud. Depending on the bank, account owners can set up texts to be sent to their mobile phones whenever their debit cards are used for purchases, or only when the purchase reaches more than $100.
Some banks also send daily notifications to the account owner to let them know their balance.
Setting up text alerts can help anyone track their spending habits and determine real-time if someone is making unauthorized purchases. Some banks also allow account holders to set up alerts via email.
3. Safeguard Data
Storing a debit card in a wallet or purse is a common practice by many. Some people might even choose to put their debit cards in the pockets of their jeans or directly place them inside their bags.
There's nothing really wrong with placing debit cards in places that are accessible to the owner, but this accessibility can also become the reason why anyone can easily get a hold of someone else's debit card.
Another way to prevent debit card fraud is to safeguard data by making sure that these cards are placed in a safe place at all times. When working, wallets or purses where debit cards are stored should be kept in a safe place, such as a locked drawer or safe.
The moment a debit card is stolen, the owner should immediately call their bank to cancel their card.
The sooner they act after finding out that their card was stolen, the lesser money the criminal can steal from their account.
4. Don't Store Data Anywhere
Adults usually use different types of cards every day. Aside from their debit cards, they also own IDs and membership cards to certain service providers.
It'd be challenging for most adults to remember all of the passwords for their cards, which is why they often use the same password or store their passwords in accessible areas, such as their smartphones or even in their handwritten notes.
To prevent debit card fraud, account owners should be careful about where they store their data. Ideally, they should memorize their passwords in their mind and never share them with anyone. It's also advisable to use different passwords on different cards to prevent criminals from stealing information.
5. Always Check Card Readers
The use of skimmers is one of the easiest ways that criminals can obtain the debit card information of another person. Skimmers are tiny card readers that are hidden underneath legitimate card readers to harvest data whenever someone swipes their card.
Here's what can happen:
- The criminal can leave the skimmer in an ATM for long periods and then pick it up after a few hours, along with the stolen data. The data stored in the skimmers is enough for criminals to make fake or cloned cards and commit fraud.
One of the reasons why a lot of people are still victimized by skimmers is because this device doesn't prevent the ATM from functioning properly, making it very tough to detect.
Anyone can still use an ATM and get money from it while the skimmer steals data.
To prevent being a victim of skimming, one should always check their card readers. If it looks off, it's best not to use it. It's also best to use ATMs attached to a bank branch, as these areas are more challenging to attack for criminals.
Using ATMs outside gas stations or grocery stores should be avoided as this is where criminals usually attach skimmers.
6. Be Careful With Stored-Value Apps
Business establishments now create apps to make it easier for their customers to buy from them. Customers can store their debit card information on this app so they can place an order within minutes and pay for it right away.
However, these establishments are not banks and don't have the equipment to properly secure money and debit card information.
App makers have less experience in keeping customers' money safe, and using these apps can make anyone prone to debit card fraud.
A good way to prevent debit card fraud is to avoid using any of these stored-value apps.
Anyone who wants to buy goods from a business should visit the store personally, or enter their details with a secure connection each time.
7. Be Cautious When Shopping Online
Because of the advent of technology, shopping from a physical store is now becoming a thing of the past.
E-commerce is taking over the world, making it easier for anyone to buy and pay for products online.
Shopping online can be very convenient, but using this platform carelessly can put someone's debit card details on a criminal's radar. In fact, paying for products online without checking the legitimacy of the website can become the main reason why debit card fraud happens.
For anyone who loves to shop online, the following precautions should be considered to prevent debit card fraud:
- Only give debit card information to websites with "https" in the address bar and show a padlock icon. The "s" in the "https" means that the website is secured.
- Avoid clicking ads that show up in emails, pretending to be retailers or banks. This is a common phishing scam that criminals use to get a person's debit card information, along with their Social Security numbers and address.
- Avoid responding to emails or websites that require personal information. Legitimate businesses will always state their reason whenever they ask for a person's debit card number.
- Do not make purchases and pay online using unsecured networks in public locations, such as restaurants and cafes. These networks can be hacked, and criminals can easily steal another person's debit card information.
Ask for Help From Professionals
Becoming a victim of debit card fraud can result in a lot of stress and unwanted expenses. For individuals who don't understand the implications of debit card fraud, being in this situation can even cause them to develop mental health problems, such as anxiety and depression.
To learn more about how to prevent fraud and scams from happening visit our learning center page.
We’ve put together this security center in order to help members become aware of the latest fraud and scam tactics, discover red flags, and learn how to take a proactive approach protecting your sensitive data.