5 ms·

This is why nobody should ever use a debit card... just get credit cards.

valleyer 13y ago
Huh? What's to stop them from doing this to credit cards? Edit: To clarify, I understood the parent comment to mean that this lowering of limits was why I should use credit cards over debit cards.
- deleted 13y ago
  [deleted]
- zevyoura 13y ago
  It's not that they couldn't do it to credit cards, but credit cards generally have better consumer fraud protections than debit cards.
- w4 13y ago
  You can easily reverse the charges on credit cards, unlike (usually, though not in this case per the banks' statements) debit cards.
  - gwillen 13y ago
    Debit cards with a Visa or Mastercard logo have the same protections as credit cards, by contract (though unlike credit cards not by law), when used for non-PIN transactions.
    - jedbrown 13y ago
      The difference is that between the time of the fraudulent charge and its resolution, your money is not in your account. With a credit card, it never makes it that far.
- cynwoody 13y ago
  Nothing. The difference is that, when fraudsters hit your credit card, you're not out any money, ab initio. You call the card company and make them take the fraudulent charge off your bill. If they refuse, they have to sue to get your money. But if the bad boys nail your debit card, your account is dinged immediately, and you have to deal with the bank to get your funds restored. Therefore, you should use ATM cards at ATMs only and only use credit cards to shop and travel and dine out (and enjoy the float and the points and pay in full every month). If your ATM card has a credit card logo (called a "check card"), call your bank and complain, and they'll issue you one that is only an ATM card and cannot be used to shop without a PIN. It's worth noting that the Target case is confined to credit cards, not debit cards. To hack a debit card, the attacker must intercept both the mag stripes and the PIN that goes with them. That's hard to do, given the way PIN pads work. Reportedly, in the Target case, they did not succeed in doing that.
  - rm999 13y ago
    There are a few inaccuracies in your comment. >If they refuse, they have to sue to get your money First, they wouldn't refuse (at least in the USA) because Visa and Mastercard contractually require issuers to cover debit cards at the same level as they do for credit cards, which is complete protection from all liability. Second, with credit cards you can't just decide what to pay off and what not to. If the issuer refuses fraud protection to you for whatever reason your credit rating is on the line if you don't pay off the balance. They may sue you, and they may damage your ability to get credit for a long time. In other words, the situation between debit and credit card protection is basically the same: in both cases the issuer will almost certainly protect you, and you're screwed if they don't. > To hack a debit card, the attacker must intercept both the mag stripes and the PIN that goes with them. This is not true in the USA. Debit cards can be used in non-point of sale transactions (e.g. phone or internet) and point of sale non-PIN "signature" transactions where you use your debit card like a credit card.
    - cynwoody 13y ago
      >Debit cards can be used in non-point of sale transactions (e.g. phone or internet) and point of sale non-PIN "signature" transactions where you use your debit card like a credit card. That's true of most debit cards, namely the ones that sport a Visa or MasterCard logo. They are called "check cards" and can be used in either debit mode (enter PIN on PINpad, no signature) or credit mode (sign if over the merchant-defined limit). Either way, the charge goes against your bank account as soon as the bank receives it. The difference between credit and debit mode is in who processes the charge. For PIN-less signature mode, the credit card network handles the transaction. For PIN debit mode, the debit network (e.g. NYCE) handles it. The debit networks are immediate: the money comes right out of your account. The credit card networks are slower. It may take a day or two for a transaction to hit your account. I remember fifteen or twenty years ago when my bank introduced check cards. I called them and asked if the new MC logo meant the card could be used without entering a PIN. They said yes, and I said I didn't want it. A replacement minus the logo (and with a different PAN) arrived a day or two later.
dsaber 13y ago
Debit cards can't be used without a PIN number, right? Target indicates that there is no evidence PIN numbers were compromised, so even if the cards got stolen, they're not that useful without brute-forcing the PIN. As such, I would think credit cards are more valuable to thieves.
- bilalq 13y ago
  You can use a debit card as a credit card in most cases though. If you hit cancel on the PIN prompt, it gives you the option to sign and charge as credit.
  - dsaber 13y ago
    True, however my understanding is that, by contract, debit cards via Visa/Mastercard have the same protections as credit cards. So consumers can submit claims against fraudulent transactions the same way they would via a credit card.
    - code_duck 13y ago
      Rather than losing credit against your credit limit, however, while awaiting resolution by your bank one would be out actual cash. Credit card companies act like actual cash is more valuable than credit - lower cash withdrawal limits, higher interest - and I'd agree.
    - pyre 13y ago
      The difference is that since they are backed by your bank account (rather than a running balance that you owe the credit card company or bank), the money comes directly out of your bank account. Depending on your bank's policies, even an immediate refund (with no fraud involved) might take a couple of weeks to credit back to your account. So, sure you might be made whole again in the end, but you are still out the cash in the meantime. That may or may not matter to you depending on your financial situation, but it's probably much better to be in a position where you are debating/challenging what you owe rather than what someone else owes you. Note: I know that the mechanics are slightly different when you "run it as a credit card" rather than a debit card, but you may be in the same boat if the money has already left your bank account (unless Visa or MasterCard lean on the bank to make things go faster in such situations).
gnur 13y ago
In the US perhaps, in the Netherlands (and the most of Europe) debit cards are the only card used in daily transactions. Credit Cards are becoming more common now and I think the main reason for that is transactions with the US. The only reason I have a credit card is for easier online shopping, even though we have a really good system for online shopping with debit cards (iDeal). But to use iDeal you need your debit card + PIN + device (with my bank anyway) to make a transaction, with a credit card you can just remember everything to make a transaction.
- bowlofpetunias 13y ago
  Add to that the fact that the hackable magnetic strip is totally history here, and in the vast majority of transactions, both physical and online, the merchant doesn't get any relevant data. I'm sure someone at some point will hack the chip, but right now you can safely lose your physical debit card, and you don't have to worry about leaks and hacks at merchants. Credit cards with their totally outdated zero authentication methods and that allow the merchant to store all the data necessary to use the account without even physically having that card are the ones that are completely unsafe. It's ridiculous that this system is still in use. Using credit cards instead of debit cards is really, really bad advice for anybody outside the US.

Huh? What's to stop them from doing this to credit cards? Edit: To clarify, I understood the parent comment to mean that this lowering of limits was why I should use credit cards over debit cards.

deleted 13y ago
[deleted]
zevyoura 13y ago
It's not that they couldn't do it to credit cards, but credit cards generally have better consumer fraud protections than debit cards.
w4 13y ago
You can easily reverse the charges on credit cards, unlike (usually, though not in this case per the banks' statements) debit cards.
- gwillen 13y ago
  Debit cards with a Visa or Mastercard logo have the same protections as credit cards, by contract (though unlike credit cards not by law), when used for non-PIN transactions.
  - jedbrown 13y ago
    The difference is that between the time of the fraudulent charge and its resolution, your money is not in your account. With a credit card, it never makes it that far.
cynwoody 13y ago
Nothing. The difference is that, when fraudsters hit your credit card, you're not out any money, ab initio. You call the card company and make them take the fraudulent charge off your bill. If they refuse, they have to sue to get your money. But if the bad boys nail your debit card, your account is dinged immediately, and you have to deal with the bank to get your funds restored. Therefore, you should use ATM cards at ATMs only and only use credit cards to shop and travel and dine out (and enjoy the float and the points and pay in full every month). If your ATM card has a credit card logo (called a "check card"), call your bank and complain, and they'll issue you one that is only an ATM card and cannot be used to shop without a PIN. It's worth noting that the Target case is confined to credit cards, not debit cards. To hack a debit card, the attacker must intercept both the mag stripes and the PIN that goes with them. That's hard to do, given the way PIN pads work. Reportedly, in the Target case, they did not succeed in doing that.
- rm999 13y ago
  There are a few inaccuracies in your comment. >If they refuse, they have to sue to get your money First, they wouldn't refuse (at least in the USA) because Visa and Mastercard contractually require issuers to cover debit cards at the same level as they do for credit cards, which is complete protection from all liability. Second, with credit cards you can't just decide what to pay off and what not to. If the issuer refuses fraud protection to you for whatever reason your credit rating is on the line if you don't pay off the balance. They may sue you, and they may damage your ability to get credit for a long time. In other words, the situation between debit and credit card protection is basically the same: in both cases the issuer will almost certainly protect you, and you're screwed if they don't. > To hack a debit card, the attacker must intercept both the mag stripes and the PIN that goes with them. This is not true in the USA. Debit cards can be used in non-point of sale transactions (e.g. phone or internet) and point of sale non-PIN "signature" transactions where you use your debit card like a credit card.
  - cynwoody 13y ago
    >Debit cards can be used in non-point of sale transactions (e.g. phone or internet) and point of sale non-PIN "signature" transactions where you use your debit card like a credit card. That's true of most debit cards, namely the ones that sport a Visa or MasterCard logo. They are called "check cards" and can be used in either debit mode (enter PIN on PINpad, no signature) or credit mode (sign if over the merchant-defined limit). Either way, the charge goes against your bank account as soon as the bank receives it. The difference between credit and debit mode is in who processes the charge. For PIN-less signature mode, the credit card network handles the transaction. For PIN debit mode, the debit network (e.g. NYCE) handles it. The debit networks are immediate: the money comes right out of your account. The credit card networks are slower. It may take a day or two for a transaction to hit your account. I remember fifteen or twenty years ago when my bank introduced check cards. I called them and asked if the new MC logo meant the card could be used without entering a PIN. They said yes, and I said I didn't want it. A replacement minus the logo (and with a different PAN) arrived a day or two later.

dsaber 13y ago

Debit cards can't be used without a PIN number, right? Target indicates that there is no evidence PIN numbers were compromised, so even if the cards got stolen, they're not that useful without brute-forcing the PIN. As such, I would think credit cards are more valuable to thieves.

bilalq 13y ago
You can use a debit card as a credit card in most cases though. If you hit cancel on the PIN prompt, it gives you the option to sign and charge as credit.
- dsaber 13y ago
  True, however my understanding is that, by contract, debit cards via Visa/Mastercard have the same protections as credit cards. So consumers can submit claims against fraudulent transactions the same way they would via a credit card.
  - code_duck 13y ago
    Rather than losing credit against your credit limit, however, while awaiting resolution by your bank one would be out actual cash. Credit card companies act like actual cash is more valuable than credit - lower cash withdrawal limits, higher interest - and I'd agree.
  - pyre 13y ago
    The difference is that since they are backed by your bank account (rather than a running balance that you owe the credit card company or bank), the money comes directly out of your bank account. Depending on your bank's policies, even an immediate refund (with no fraud involved) might take a couple of weeks to credit back to your account. So, sure you might be made whole again in the end, but you are still out the cash in the meantime. That may or may not matter to you depending on your financial situation, but it's probably much better to be in a position where you are debating/challenging what you owe rather than what someone else owes you. Note: I know that the mechanics are slightly different when you "run it as a credit card" rather than a debit card, but you may be in the same boat if the money has already left your bank account (unless Visa or MasterCard lean on the bank to make things go faster in such situations).

gnur 13y ago

In the US perhaps, in the Netherlands (and the most of Europe) debit cards are the only card used in daily transactions. Credit Cards are becoming more common now and I think the main reason for that is transactions with the US. The only reason I have a credit card is for easier online shopping, even though we have a really good system for online shopping with debit cards (iDeal). But to use iDeal you need your debit card + PIN + device (with my bank anyway) to make a transaction, with a credit card you can just remember everything to make a transaction.

bowlofpetunias 13y ago
Add to that the fact that the hackable magnetic strip is totally history here, and in the vast majority of transactions, both physical and online, the merchant doesn't get any relevant data. I'm sure someone at some point will hack the chip, but right now you can safely lose your physical debit card, and you don't have to worry about leaks and hacks at merchants. Credit cards with their totally outdated zero authentication methods and that allow the merchant to store all the data necessary to use the account without even physically having that card are the ones that are completely unsafe. It's ridiculous that this system is still in use. Using credit cards instead of debit cards is really, really bad advice for anybody outside the US.