Debit-Card Identity Theft on the Rise: Choose Credit, Not Debit, When Paying

One would not imagine crooks could target their debit card the same vicious way credit cards can be, but more and more Americans are turning to debit cards to pay for their purchases resulting in fewer checks and less cash being used at the checkout counter. Sure, nothing will ever completely replace the old fashioned dollar bill, but credit card and debit card slips are going to soon outnumber the amount of president's faces in America's cash registers.

As the interest of Americans leans more toward the use of debit cards, so does the interest of crooks to steal one's identity. Identity theft has been a problem in this country since the dawn of banks. We see in movies and read in books that even in the old western days there were people claiming to be the account holder when they were not. Yet, it seems we hear more and more about identity theft now. Could it be because it is more prevalent? Perhaps it is because we are more aware of it. Either way, it is a dangerous thing and as Americans are acquiring more credit the motivation of identity thieves grows as well.

Unfortunately, despite the fact that debit cards operate the same as credit cards in many ways, debit cards can lack the same securities. Also, where identity thieves used to target the databases of large companies who held substantial amount of credit card data, we are now seeing these thieves target the smaller companies where the money and resources may not be there to put proper security where it needs to be. That is why it is important to know the difference between debit cards and credit cards. In the case that your information is accessed through database theft, you just might be more protected with a credit card than a debit card.

You see, your debit card is managed by your bank and usually the bank cannot do anything until after the unauthorized charges have occurred. Even if you immediately close your account and open a new one, it is a waiting game. You then have to dispute the charges with a dispute department while dealing with opening the new account. This whole process can be painful because you have to transfer money, order new checks (if you use them), and wait for a new card. Yet, you still have to keep the existing account open because of any pending transactions.

Debit card identity theft can cost you hundreds if not thousands of dollars if the theft is not proven. It is harder to prove unauthorized transactions with a debit card than a check because your bank usually holds the returned checks on microfilm whether or not they are returned to you in the mail. In a debit card transaction, the merchant may have a slip of paper to prove the transaction, but unless your card has a Visa or Mastercard logo on it so that you can choose credit, some merchants do not have a slip in which you sign. All you get is a receipt.

Just make sure you are using your debit card in places you are familiar with and be careful as to where you use your card in online transactions. The internet has become an identity theft haven because of computer hackers accessing financial information that we keep on our computers. It is a wise thing to keep no financial information at all despite how well we think we have our computers protected from outside intruders.

You also want to maker sure that when you are at the cash register to choose the credit option so that you can receive a slip of paper with your signature on it. The merchant will maintain a copy of it as well. This way, the merchant has a copy of the signature on a particular transaction in case you must dispute it. Unless a thief knows your pin number on a debit transaction, they will have no choice but to use the credit option, which forces them to sign something.

With these things in mind regarding the security differences between credit and debit, choose wisely how and where you want to use your debit card. Most banks now offer debit cards with the Visa or Mastercard logo for the reason the consumer can use the credit function. It also allows the card to be used in more places, and as you read above, it allows for better recordkeeping. Yet, since databases are hacked all of the time and we all have some sort of financial information stored in a computer somewhere, pay close attention to your bank statements because you just never know when you may be next on a thief's hit list.