4 ms·

I’m not sure this is still true. Debit cards have a similar dispute process to credit cards.

wccrawford 2y ago
But the money is already gone. You will probably get it back, but you don't have it until then. With a credit card, you haven't lost anything yet.
- AnthonyMouse 2y ago
  Well sure you have, you've had your available credit reduced by that amount. If you have a surplus of cash or available credit then this makes no major difference in either case. If you don't and then try to make a transaction, you get whacked with penalties etc.
  - Loughla 2y ago
    There is a distinct and appreciable difference between having a lower credit limit and not having the actual money in my bank account. One of those involves me not having money. One does not.
    - AnthonyMouse 2y ago
      If you have money in your bank account, you can swipe your card at the store and get stuff. If you have available credit, you can swipe your card at the store and get stuff. These are both money. In the second case you may have borrowed the money and are then expected to pay it back later, but in general this is the method to be avoided unless you have a need for it, because borrowing money incurs fees/interest charges (whether directly or indirectly).
      - losvedir 2y ago
        This subthread is about fraud. If someone steals your debit card the money is gone from your bank account until the dispute resolution has happened. In contrast, if someone steals your credit card you dispute the transactions and until it's resolved you just have a lower available credit. But the point is you had money in your bank account anyway and were just paying with the credit card for the fraud and/or rewards reasons and that money is still there.
      - ThunderSizzle 2y ago
        Unless if you only have enough available credit for a couple of purchases (e.g. maybe your first credit card or bad credit credit card), this distinction is pointless. Almost no fraud will touch the thousands of dollars of available credit, especially if on different or multiple cards. Losing some available credit is not even a nuisance for most people who have any semblance of decent credit history. Regardless, your last paragraph is also wrong. If the price is same when using a debit or credit card, it's better to use the credit card. You can keep the money in your account (and could be used in event of emergencies) and also earn interest until statement due date. There are no fees or interest when you pay your statement balance in full every month, which means you've gained 5% interest for about a month's worth of credit spending in your HYSA for the same price.
        seadan83 2y ago
        That second paragraph is just as wrong as yours. You're both right in some cases. The average American has several thousand dollars of credit card debt [1]. They are paying interest. [1] https://www.cnbc.com/2024/03/27/how-much-credit-card-debt-americans-have-by-age-.html https://www.cnbc.com/2024/03/27/how-much-credit-card-debt-am...
        DataDive 2y ago
        Check those numbers. I looked at the original data, and it seems that in the report you linked, debt is defined as a credit card balance. I don't know about others, but I always float thousands on my balance and pay it off by the end of the month; the payment is all automatic. Often, for large sums, I pay it off online right away when I get home. In my opinion, this is not debt—as long as you have the money, don't overspend, and pay it off within the grace period of 30 days, as long you are using the credit card as an intermediary for convenience and as a service that gives you various protections. There is benefit to the customer.
        seadan83 2y ago
        Credit card debt and credit card balance are the same thing. > I don't know about others, but I always float thousands on my balance This is the operative part. People on this forum tend to be in tech, and floating thousands is possible. A quick google search showed average US income is 60k/yr. Less 10k for taxes, less 20k for housing, that allows a float of less than 3k per year. The source previously stated an average debt of 6k, which is a balance more then the monthly income, and ergo is being carried over. Looking for more direct data on how many Americans are paying credit card interest, I found this data: "Half of credit cardholders surveyed in June (2024) as part of Bankrate's latest Credit Card Debt Survey said they carry balances over month to month. That is up from 44% in January – and the highest since since March 2020, when 60% of people carried debt from month to month" [1] I thereby stand by my statement that your second paragraph was equally wrong (and equally right) as the second paragraph you were calling wrong. [1] https://www.usatoday.com/story/money/2024/08/10/credit-card-debt-balance/74741230007/ https://www.usatoday.com/story/money/2024/08/10/credit-card-...
    - M95D 2y ago
      A debit card with 100$ on it can only be frauded to 0$. A credit card with 100$ on it can be frauded to -10'000$ or whatever the limit is. You think a fraud will stop before reaching the limit? If you have a debit card with no money, but a regular income, the bank will be happy to issue a new credit card to you. Where I live (EU), I can request it via internet banking and it takes ~3 days until the card arrives in the mail. Virtual cards are available immediately.
      - triceratops 2y ago
        > You think a fraud will stop before reaching the limit? Yes. Credit card issuers block transactions they believe are fraudulent. Being liable for fraud motivates them strongly. Anecdotally I've had a couple of credit cards compromised in my life. On each occasion the thief got less than a couple hundred dollars before being detected. A thief will usually try a couple smaller transactions first to see if the card is good. Large unusual transactions get flagged for review quickly.
        M95D 2y ago
        > Credit card issuers block transactions they believe are fraudulent. They do? I never had a CC and I don't know if that's the case where I live. Maybe I'm being paranoid, but I don't trust banks: I don't trust them blocking fraud transactions, and if they do, then I wouldn't trust them to not block my transactions and leave me stranded on vacation somewhere, and finally I don't trust them to revert fraud transactions if they ever happen.
        triceratops 2y ago
        > I wouldn't trust them to not block my transactions and leave me stranded on vacation somewhere I have multiple credit cards. And a debit card, and cash. It's advisable to notify the credit card company if you plan to travel. Most card websites and apps have a feature for this. > I don't trust them to revert fraud transactions if they ever happen. This might be a European thing. In the US credit card issuers are liable for any fraudulent transactions by law.
  - philwelch 2y ago
    Yes but my credit limit is a very large buffer to the amount of cash in my bank account.
    - AnthonyMouse 2y ago
      But what does that matter? Suppose you have a $10,000 credit limit and $100 in your bank account, and then you have to dispute a $100 transaction while also needing to buy something else that costs $20. If the dispute is over your bank balance then you put the $20 on your credit card. That causes you to have a $20 credit card balance, but in the alternative you have a $100 credit card balance -- and may or may not win the dispute.
      - philwelch 2y ago
        We're arguing about credit card versus debit card. If you decide debit cards are better and, as a result, you don't have a credit card, you don't have that $10,000 credit limit. Also, available credit limits are much less valuable to me than actual money, so I will preferentially risk part of my credit limit before risking actual money. If the bank reduced my credit limit by $1000, I wouldn't mind nearly as much as if they reduced my checking account balance by $1000. I think most financially responsible people would feel the same way. Likewise if the bank increased my credit limit by $1000, I wouldn't be nearly as excited as I would be if someone gave me $1000 in actual money. If it's just a question of what you're going to use for one particular transaction, sure, you can use your debit card sometimes. I do. And part of the issue is that credit lines and actual money aren't perfectly fungible. For instance, I can't use my credit card to pay my credit card bill. I also can't use it to pay my mortgage.
  - kelnos 2y ago
    > If you don't and then try to make a transaction, you get whacked with penalties etc. No you don't. Your card just gets declined. This seems like a weird argument anyway. Sure, in some cases you will get hit with credit card fraud and will also at that time have no further available credit, and no cash on hand. But I expect that's the exception, not the rule. If we're talking about debit card fraud, every single time that happens, the money will be gone while you're waiting for the dispute to be resolved.
    - davrosthedalek 2y ago
      And even if you hit your credit limit, the money is still in the account, so you can spend it -- just not by using your credit card -- but you can still go to the ATM and get cash, for example. You cannot spend it when fraud happens with a debit card.
      - AnthonyMouse 2y ago
        You can very much get a cash advance against a credit card, if you require physical cash. But that's an extremely unusual outlier anyway -- needing enough physical cash that it exceeds the balance of your bank account. If you had a $1000 balance and then have a $100 dispute and have to immediately make $1000 in payments, you don't need a cash advance unless over 90% of the payments are required to be in cash, because the remainder can be on credit.
    - AnthonyMouse 2y ago
      > No you don't. Your card just gets declined. Credit cards work how your agreement says they work. If you exceed your credit limit they can offer to extend you more credit but charge you a fee/penalty for doing that. Conversely, you can have a bank that will decline debit transactions instead of extending overdraft protection. Credit card companies are less likely to extend overdraft protection, because if you're already at your credit limit they may not want to risk lending you even more money, but that's why there's typically a fee to offset the risk when they do offer it. > If we're talking about debit card fraud, every single time that happens, the money will be gone while you're waiting for the dispute to be resolved. The amount of money you have available to you is the sum of your positive balance and your available credit. If you have $1000 in available credit and $1000 in your bank account, you can spend up to $2000. If you have to dispute a new $100 transaction, you can now only spend $1900 more dollars until the dispute resolves, regardless of whether the dispute was on your credit card or your debit card.
loeg 2y ago
They may, if the issuer wants to be generous. They are not entitled to the same legal protections that credit cards are.
- lxgr 2y ago
  That's largely a myth these days: Scheme rules mostly require issuers to extend a zero-liability policy to consumer debit cardholders. Even if they wouldn't, there is a little-known debit counterpart to Regulation Z (which is the federal regulation affording you all the nice credit liability protections you might be used to) called Regulation E: As long as you notify the issuer/bank within 60 days, your losses are also capped to $500. But since most banks don't want to lose a customer over a deductible in an edge cases (usually they can recover the funds themselves via a chargeback), the real loss is usually zero.
  - loeg 2y ago
    You say you're disagreeing with me but the text of your comment substantiates what I wrote.
    - lxgr 2y ago
      I think we agree on the outcome, but not the mechanism. I'm saying that debit protections have nothing to do with the issuer "feeling generous", and a lot with market forces and legal regulations, just like for credit cards.
  - clooless 2y ago
    It's no myth. The bank will keep the money in many cases by claiming you were negligent. You have no recourse.
tourmalinetaco 2y ago
Nope. My brother was on the hook for $900 because his debit card got skimmed.
- Loughla 2y ago
  I ate over 1000 when I got skimmed. It was what made me realize that Banks, even hometown small banks, are not your friend. They screwed me all over.
  - mixmastamyk 2y ago
    I don’t think ‘skimmed’ still works? Chip and tap must respond.
yakz 2y ago
They do but usually your money is gone until the dispute is resolved. With a credit card, some fabulously wealthy company’s money is gone and literally nobody is gonna cry over that.
kelnos 2y ago
When you dispute a credit card charge, the money is still in your bank account, and you can spend it on food. When you dispute a debit card charge, the money is completely inaccessible until the dispute is resolved.
- potato3732842 2y ago
  When a dispute is filed the bank will issue a provisional credit the same or next business day if the dispute meets certain criteria. I forget the exact details on when you do and don't get a provisional credit right off the bat but basically boils down to the only situation in which you wouldn't get a credit would be where it's not a dispute over whether the charge was authorized but one over whether the goods/services were delivered because in those cases the bank has to give the merchant a chance to tell their side of the story or make good or whatever. I forget if this is a Visa/Mastercard network policy (they homogenized the rules between credit/debit cards awhile back and it might have been part of that) or a regulatory one but the end result is that you're only without money for a day if there's an unauthorized charge.

But the money is already gone. You will probably get it back, but you don't have it until then. With a credit card, you haven't lost anything yet.

AnthonyMouse 2y ago
Well sure you have, you've had your available credit reduced by that amount. If you have a surplus of cash or available credit then this makes no major difference in either case. If you don't and then try to make a transaction, you get whacked with penalties etc.
- Loughla 2y ago
  There is a distinct and appreciable difference between having a lower credit limit and not having the actual money in my bank account. One of those involves me not having money. One does not.
  - AnthonyMouse 2y ago
    If you have money in your bank account, you can swipe your card at the store and get stuff. If you have available credit, you can swipe your card at the store and get stuff. These are both money. In the second case you may have borrowed the money and are then expected to pay it back later, but in general this is the method to be avoided unless you have a need for it, because borrowing money incurs fees/interest charges (whether directly or indirectly).
    - losvedir 2y ago
      This subthread is about fraud. If someone steals your debit card the money is gone from your bank account until the dispute resolution has happened. In contrast, if someone steals your credit card you dispute the transactions and until it's resolved you just have a lower available credit. But the point is you had money in your bank account anyway and were just paying with the credit card for the fraud and/or rewards reasons and that money is still there.
    - ThunderSizzle 2y ago
      Unless if you only have enough available credit for a couple of purchases (e.g. maybe your first credit card or bad credit credit card), this distinction is pointless. Almost no fraud will touch the thousands of dollars of available credit, especially if on different or multiple cards. Losing some available credit is not even a nuisance for most people who have any semblance of decent credit history. Regardless, your last paragraph is also wrong. If the price is same when using a debit or credit card, it's better to use the credit card. You can keep the money in your account (and could be used in event of emergencies) and also earn interest until statement due date. There are no fees or interest when you pay your statement balance in full every month, which means you've gained 5% interest for about a month's worth of credit spending in your HYSA for the same price.
      - seadan83 2y ago
        That second paragraph is just as wrong as yours. You're both right in some cases. The average American has several thousand dollars of credit card debt [1]. They are paying interest. [1] https://www.cnbc.com/2024/03/27/how-much-credit-card-debt-americans-have-by-age-.html https://www.cnbc.com/2024/03/27/how-much-credit-card-debt-am...
        DataDive 2y ago
        Check those numbers. I looked at the original data, and it seems that in the report you linked, debt is defined as a credit card balance. I don't know about others, but I always float thousands on my balance and pay it off by the end of the month; the payment is all automatic. Often, for large sums, I pay it off online right away when I get home. In my opinion, this is not debt—as long as you have the money, don't overspend, and pay it off within the grace period of 30 days, as long you are using the credit card as an intermediary for convenience and as a service that gives you various protections. There is benefit to the customer.
        seadan83 2y ago
        Credit card debt and credit card balance are the same thing. > I don't know about others, but I always float thousands on my balance This is the operative part. People on this forum tend to be in tech, and floating thousands is possible. A quick google search showed average US income is 60k/yr. Less 10k for taxes, less 20k for housing, that allows a float of less than 3k per year. The source previously stated an average debt of 6k, which is a balance more then the monthly income, and ergo is being carried over. Looking for more direct data on how many Americans are paying credit card interest, I found this data: "Half of credit cardholders surveyed in June (2024) as part of Bankrate's latest Credit Card Debt Survey said they carry balances over month to month. That is up from 44% in January – and the highest since since March 2020, when 60% of people carried debt from month to month" [1] I thereby stand by my statement that your second paragraph was equally wrong (and equally right) as the second paragraph you were calling wrong. [1] https://www.usatoday.com/story/money/2024/08/10/credit-card-debt-balance/74741230007/ https://www.usatoday.com/story/money/2024/08/10/credit-card-...
  - M95D 2y ago
    A debit card with 100$ on it can only be frauded to 0$. A credit card with 100$ on it can be frauded to -10'000$ or whatever the limit is. You think a fraud will stop before reaching the limit? If you have a debit card with no money, but a regular income, the bank will be happy to issue a new credit card to you. Where I live (EU), I can request it via internet banking and it takes ~3 days until the card arrives in the mail. Virtual cards are available immediately.
    - triceratops 2y ago
      > You think a fraud will stop before reaching the limit? Yes. Credit card issuers block transactions they believe are fraudulent. Being liable for fraud motivates them strongly. Anecdotally I've had a couple of credit cards compromised in my life. On each occasion the thief got less than a couple hundred dollars before being detected. A thief will usually try a couple smaller transactions first to see if the card is good. Large unusual transactions get flagged for review quickly.
      - M95D 2y ago
        > Credit card issuers block transactions they believe are fraudulent. They do? I never had a CC and I don't know if that's the case where I live. Maybe I'm being paranoid, but I don't trust banks: I don't trust them blocking fraud transactions, and if they do, then I wouldn't trust them to not block my transactions and leave me stranded on vacation somewhere, and finally I don't trust them to revert fraud transactions if they ever happen.
        triceratops 2y ago
        > I wouldn't trust them to not block my transactions and leave me stranded on vacation somewhere I have multiple credit cards. And a debit card, and cash. It's advisable to notify the credit card company if you plan to travel. Most card websites and apps have a feature for this. > I don't trust them to revert fraud transactions if they ever happen. This might be a European thing. In the US credit card issuers are liable for any fraudulent transactions by law.
- philwelch 2y ago
  Yes but my credit limit is a very large buffer to the amount of cash in my bank account.
  - AnthonyMouse 2y ago
    But what does that matter? Suppose you have a $10,000 credit limit and $100 in your bank account, and then you have to dispute a $100 transaction while also needing to buy something else that costs $20. If the dispute is over your bank balance then you put the $20 on your credit card. That causes you to have a $20 credit card balance, but in the alternative you have a $100 credit card balance -- and may or may not win the dispute.
    - philwelch 2y ago
      We're arguing about credit card versus debit card. If you decide debit cards are better and, as a result, you don't have a credit card, you don't have that $10,000 credit limit. Also, available credit limits are much less valuable to me than actual money, so I will preferentially risk part of my credit limit before risking actual money. If the bank reduced my credit limit by $1000, I wouldn't mind nearly as much as if they reduced my checking account balance by $1000. I think most financially responsible people would feel the same way. Likewise if the bank increased my credit limit by $1000, I wouldn't be nearly as excited as I would be if someone gave me $1000 in actual money. If it's just a question of what you're going to use for one particular transaction, sure, you can use your debit card sometimes. I do. And part of the issue is that credit lines and actual money aren't perfectly fungible. For instance, I can't use my credit card to pay my credit card bill. I also can't use it to pay my mortgage.
- kelnos 2y ago
  > If you don't and then try to make a transaction, you get whacked with penalties etc. No you don't. Your card just gets declined. This seems like a weird argument anyway. Sure, in some cases you will get hit with credit card fraud and will also at that time have no further available credit, and no cash on hand. But I expect that's the exception, not the rule. If we're talking about debit card fraud, every single time that happens, the money will be gone while you're waiting for the dispute to be resolved.
  - davrosthedalek 2y ago
    And even if you hit your credit limit, the money is still in the account, so you can spend it -- just not by using your credit card -- but you can still go to the ATM and get cash, for example. You cannot spend it when fraud happens with a debit card.
    - AnthonyMouse 2y ago
      You can very much get a cash advance against a credit card, if you require physical cash. But that's an extremely unusual outlier anyway -- needing enough physical cash that it exceeds the balance of your bank account. If you had a $1000 balance and then have a $100 dispute and have to immediately make $1000 in payments, you don't need a cash advance unless over 90% of the payments are required to be in cash, because the remainder can be on credit.
  - AnthonyMouse 2y ago
    > No you don't. Your card just gets declined. Credit cards work how your agreement says they work. If you exceed your credit limit they can offer to extend you more credit but charge you a fee/penalty for doing that. Conversely, you can have a bank that will decline debit transactions instead of extending overdraft protection. Credit card companies are less likely to extend overdraft protection, because if you're already at your credit limit they may not want to risk lending you even more money, but that's why there's typically a fee to offset the risk when they do offer it. > If we're talking about debit card fraud, every single time that happens, the money will be gone while you're waiting for the dispute to be resolved. The amount of money you have available to you is the sum of your positive balance and your available credit. If you have $1000 in available credit and $1000 in your bank account, you can spend up to $2000. If you have to dispute a new $100 transaction, you can now only spend $1900 more dollars until the dispute resolves, regardless of whether the dispute was on your credit card or your debit card.

loeg 2y ago

They may, if the issuer wants to be generous. They are not entitled to the same legal protections that credit cards are.

lxgr 2y ago
That's largely a myth these days: Scheme rules mostly require issuers to extend a zero-liability policy to consumer debit cardholders. Even if they wouldn't, there is a little-known debit counterpart to Regulation Z (which is the federal regulation affording you all the nice credit liability protections you might be used to) called Regulation E: As long as you notify the issuer/bank within 60 days, your losses are also capped to $500. But since most banks don't want to lose a customer over a deductible in an edge cases (usually they can recover the funds themselves via a chargeback), the real loss is usually zero.
- loeg 2y ago
  You say you're disagreeing with me but the text of your comment substantiates what I wrote.
  - lxgr 2y ago
    I think we agree on the outcome, but not the mechanism. I'm saying that debit protections have nothing to do with the issuer "feeling generous", and a lot with market forces and legal regulations, just like for credit cards.
- clooless 2y ago
  It's no myth. The bank will keep the money in many cases by claiming you were negligent. You have no recourse.

tourmalinetaco 2y ago

Nope. My brother was on the hook for $900 because his debit card got skimmed.

Loughla 2y ago
I ate over 1000 when I got skimmed. It was what made me realize that Banks, even hometown small banks, are not your friend. They screwed me all over.
- mixmastamyk 2y ago
  I don’t think ‘skimmed’ still works? Chip and tap must respond.

yakz 2y ago

They do but usually your money is gone until the dispute is resolved. With a credit card, some fabulously wealthy company’s money is gone and literally nobody is gonna cry over that.

kelnos 2y ago

When you dispute a credit card charge, the money is still in your bank account, and you can spend it on food. When you dispute a debit card charge, the money is completely inaccessible until the dispute is resolved.

potato3732842 2y ago
When a dispute is filed the bank will issue a provisional credit the same or next business day if the dispute meets certain criteria. I forget the exact details on when you do and don't get a provisional credit right off the bat but basically boils down to the only situation in which you wouldn't get a credit would be where it's not a dispute over whether the charge was authorized but one over whether the goods/services were delivered because in those cases the bank has to give the merchant a chance to tell their side of the story or make good or whatever. I forget if this is a Visa/Mastercard network policy (they homogenized the rules between credit/debit cards awhile back and it might have been part of that) or a regulatory one but the end result is that you're only without money for a day if there's an unauthorized charge.