5 ms·

I wonder how much of this is FUD given the fact banks don't make as much money off of debit card purchases.

encoderer 17y ago
IMO you'd be pretty foolish to use your debit card anywhere. The Visa or MC logo give you a false sense that it has the same fraud protection and benefits as your credit card. It does not. And it has a great deal more potential to disrupt your life in the event of fraud. And moreover, signature based debit card transactions make the bank the exact same amount of revenue as the same transaction on a credit card. As long as you pay the card off every month then what we're talking about wrt revenue is the discount rate. A merchant provider doesn't distinguish between types of cards-- they all have the same fees-- they only distinguish between issuer (Visa/MC vs Discover and Amex).
- abrown28 17y ago
  I've had two erroneous charges on my debit card and Bank of America refunded my money before they started an investigation. It had a minimal impact on my day. Of course this is anecdotal evidence so take it with a grain of salt.
  - encoderer 17y ago
    But you are just one data point... First, the refund they give you is preliminary. Second, there is a common scam that debit cards are susceptible to and credit cards are not. It goes like this: I steal your debit card info. I mail you something trivial. A trinket. Cereal box stuff. I send it USPS Signature Confirm. It has "Reward Dept" listed on the outside and you sign for it.. I mean, why not? You're perplexed by the contents. Somebody spent $3 to mail THIS? I charge your debit card. Hundreds of dollars. Not usually thousands, not big enough to make FBI radar screens. You call Bank of America. They give you a preliminary refund. They investigate. They call me, the perpetrator, as part of the charge back process. I say "Oh, well, I have A. Brown's signature from USPS, as you can see right here." They take the money out of your account. They call you. You are incredulous. You ask for a supervisor. You demand "So if I buy a laptop and they mail me a brick, you can't help me? Just because I signed for it?" They explain that "How would we know? You'll have to sue them to get your money back." You see, there's a very big difference. With a credit card, the bank is on the hook, until you pay your bill. Until you pay, the fraud is perpetrated against THEM. And federal law gives you right NOT to pay a disputed charge. With a debit card, you are the victim. Hell, the bank even made 2-3% on the fraud. Not to mention, as I replied above, I make between 2 and 3% cash back each year on my credit cards. We're not rich, but even at our spending, that's a nice chunk of money each year. Far better than the measly "points" some debit cards offer. (Edit: And in the same vein, once you pay your CC bill, you lose most your rights and conveniences for dealing with fraud. That's why it's important when using things like BoAs ebill initiated payments to still review your statements before you pay the bill.)
- fnid2 17y ago
  When the banks ask me if I want a debit card, I say no. I have a credit card and I have an ATM card that cannot function as a debit card. Much less risk for me.
  - anamax 17y ago
    > I have a credit card and I have an ATM card that cannot function as a debit card. Much less risk for me. I agree about the risk, but my bank won't give me an ATM card that isn't also a debit card. What US bank still issue ATM only cards?
    - fnid2 17y ago
      It's actually a credit union, which is far better IMO than a traditional bank. I have a business account at a bank who wouldn't give me an ATM (non debit) so I immediately cut it up.
- derefr 17y ago
  I was confused for a moment until I realized you were likely talking about check cards issued by credit card companies; here (Canada), "debit card" refers to a piece of plastic given to you with your bank's name on it and a nonstandard serial number, that can't be used online in place of a CCN, and has always required a PIN number, even before chip-and-PIN was established. Here, they have a much different fee structure than credit cards for supporting businesses, so some businesses choose to not support one or the other for small purchases where it isn't "worth it" to them. Also, there's no way to put a "hold" on this kind of card—it's basically an immediate wire transfer, not a cash advance, and the terminal you use a debit card in doesn't (can't) store anything that could be used to charge you further after the fact. Thus, they're much more widely used here, because the amount that shows up on the keypad is the amount your account will be charged, never more or less. The only problem with them is that, unlike with credit or check cards, they have to be able to directly dial their own bank infrastructure (via an agreed-upon protocol, here called INTERAC) to function. Thus, in a foreign country, it's much easier to just use your credit card.

IMO you'd be pretty foolish to use your debit card anywhere. The Visa or MC logo give you a false sense that it has the same fraud protection and benefits as your credit card. It does not. And it has a great deal more potential to disrupt your life in the event of fraud. And moreover, signature based debit card transactions make the bank the exact same amount of revenue as the same transaction on a credit card. As long as you pay the card off every month then what we're talking about wrt revenue is the discount rate. A merchant provider doesn't distinguish between types of cards-- they all have the same fees-- they only distinguish between issuer (Visa/MC vs Discover and Amex).

abrown28 17y ago
I've had two erroneous charges on my debit card and Bank of America refunded my money before they started an investigation. It had a minimal impact on my day. Of course this is anecdotal evidence so take it with a grain of salt.
- encoderer 17y ago
  But you are just one data point... First, the refund they give you is preliminary. Second, there is a common scam that debit cards are susceptible to and credit cards are not. It goes like this: I steal your debit card info. I mail you something trivial. A trinket. Cereal box stuff. I send it USPS Signature Confirm. It has "Reward Dept" listed on the outside and you sign for it.. I mean, why not? You're perplexed by the contents. Somebody spent $3 to mail THIS? I charge your debit card. Hundreds of dollars. Not usually thousands, not big enough to make FBI radar screens. You call Bank of America. They give you a preliminary refund. They investigate. They call me, the perpetrator, as part of the charge back process. I say "Oh, well, I have A. Brown's signature from USPS, as you can see right here." They take the money out of your account. They call you. You are incredulous. You ask for a supervisor. You demand "So if I buy a laptop and they mail me a brick, you can't help me? Just because I signed for it?" They explain that "How would we know? You'll have to sue them to get your money back." You see, there's a very big difference. With a credit card, the bank is on the hook, until you pay your bill. Until you pay, the fraud is perpetrated against THEM. And federal law gives you right NOT to pay a disputed charge. With a debit card, you are the victim. Hell, the bank even made 2-3% on the fraud. Not to mention, as I replied above, I make between 2 and 3% cash back each year on my credit cards. We're not rich, but even at our spending, that's a nice chunk of money each year. Far better than the measly "points" some debit cards offer. (Edit: And in the same vein, once you pay your CC bill, you lose most your rights and conveniences for dealing with fraud. That's why it's important when using things like BoAs ebill initiated payments to still review your statements before you pay the bill.)
fnid2 17y ago
When the banks ask me if I want a debit card, I say no. I have a credit card and I have an ATM card that cannot function as a debit card. Much less risk for me.
- anamax 17y ago
  > I have a credit card and I have an ATM card that cannot function as a debit card. Much less risk for me. I agree about the risk, but my bank won't give me an ATM card that isn't also a debit card. What US bank still issue ATM only cards?
  - fnid2 17y ago
    It's actually a credit union, which is far better IMO than a traditional bank. I have a business account at a bank who wouldn't give me an ATM (non debit) so I immediately cut it up.
derefr 17y ago
I was confused for a moment until I realized you were likely talking about check cards issued by credit card companies; here (Canada), "debit card" refers to a piece of plastic given to you with your bank's name on it and a nonstandard serial number, that can't be used online in place of a CCN, and has always required a PIN number, even before chip-and-PIN was established. Here, they have a much different fee structure than credit cards for supporting businesses, so some businesses choose to not support one or the other for small purchases where it isn't "worth it" to them. Also, there's no way to put a "hold" on this kind of card—it's basically an immediate wire transfer, not a cash advance, and the terminal you use a debit card in doesn't (can't) store anything that could be used to charge you further after the fact. Thus, they're much more widely used here, because the amount that shows up on the keypad is the amount your account will be charged, never more or less. The only problem with them is that, unlike with credit or check cards, they have to be able to directly dial their own bank infrastructure (via an agreed-upon protocol, here called INTERAC) to function. Thus, in a foreign country, it's much easier to just use your credit card.