Credit vs. Debit Cards: Which Is Safest for Online Shopping?
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Financial fraud can be devastating, but what are the differences between a credit card and a debit card scam? Should you use one kind of card over the other when buying online?

Let’s break down the fraud protection for both types of cards—is one better than the other?

Breaking Down Card Liability

When your card is stolen or used in financial fraud, you may find yourself under “liability.” Liability is when you have fees imposed upon you due to the misuse of your card. These fees can add to the list of problems from having your card scammed, so it’s essential to keep your liability fees low.

Your Liabilities With Credit Cards

Liability with credit cards will vary depending on your country. For the US, Experian states the maximum amount of money you have to pay in liabilities is $50. Sometimes, the bank won’t bother with this fee, and you’ll get your dispute resolved without having to pay.

Your Liabilities With Debit Cards

Debit cards work a little differently. If you report the card as stolen or compromised before the scammer makes transactions, you won’t pay any liabilities. If you report the fraud up to two days after the scam, your liability is $50. Wait until 60 days, and it grows to $500. After 60 days, the liability becomes unlimited, meaning you could potentially lose out on claiming your money back.

The Legal Case for Card Purchases

A court of law

For some countries, getting your scammed money back isn’t just a courtesy; it’s the law. Unfortunately, it can depend on which card you use and how you use it.

Legal Rulings for Credit Cards

For credit cards, the US has the Fair Credit Billing Act (FCBA). If you make a purchase of $50 or more with a credit card, you can raise problems with the card issuer. These reasons can range from an item lost in the mail to a faulty product on arrival.

The UK has its version of this act called Section 75. This law covers all credit card-related purchases between £100 and £30,000. Like the US version, this includes any sales made under false advertising, as well as goods that are faulty on arrival.

Legal Rulings for Debit Cards

As you may have guessed, you don’t get these protections with a debit card. If something does go wrong with your purchase, you can’t take it up with your card provider. You have to communicate with the seller and hope you can work something out between the two of you.

How Scams Affect Your Funds With Cards

A man holding smartphone with mobile banking application on a screen.
Image Credit: bloomua/DepositPhotos

It’s also good to note that a credit card scam won’t play out identically to a debit card scam. This is due to what finances the scammer accesses during the fraud, and how it affects your balance.

What Happens If a Scammer Uses Your Credit Card

Let’s assume the worst-case scenario where the scammer uses all the money on the card. If the scammer got hold of your credit card, the card’s upper limit defines how much they can spend. This limit puts a cap on the amount a scammer can use and doesn’t give them a “blank checkbook” for scams.

On top of that, consider whose money the scammer uses during a scam. When you use a credit card, the bank covers the cost. As such, should a scammer use your credit card, it’ll come out of the bank’s pocket while your funds remain unaffected. This means you can still purchase goods with your funds while the bank recovers their cash.

What Happens If a Scammer Uses Your Debit Card

Should this scenario happen with your debit card, however, the scammer will have access to your finds. In a worst-case scenario, they’ll drain the account and leave you with only the money in your wallet.

While it’s likely you’ll get this money back (if you respond quickly!), you still need to pay bills and buy groceries until the case is solved. Until then, you’ll need to go into a deeper financial mess to make ends meet while the bank investigates the scam.

How to Keep a Debit Card Safe Online

Right now, we’ve made an excellent case to use your credit card when purchasing online. The fees involved with rectifying a scam are smaller, laws protect your expensive credit card purchases, and any successful scams will take money from your credit card balance instead of your main account.

But what if you don’t have a credit card? Perhaps you suffer from bad credit, you can’t apply for one yet, or you don’t want the temptation of using credit. Whatever your reasons, the above points may make you unsure about using your debit card. It’s still safe to use it; however, you need to be more careful.

Limit Who Sees Your Full Debit Card Details

First, you can limit how many companies see your debit card number. You can use legitimate payment services such as PayPal to handle your cards instead. When you use PayPal to purchase something, the website never sees your payment details; PayPal keeps that information safe from them.

Take Care of Sensitive Financial Documents

Be careful with anything that reveals your debit card details. You shouldn’t be writing down your card number and PIN where people could find them.

On top of this, be careful about documents stored online that contain your financial details. If a hacker gains access to these documents, they can use the information to perform scams and identity theft.

Use Autofill When Possible

Some modern browsers allow you to save your debit card details in the autofill settings. This feature means you don’t need to enter your card number every time you shop; you only need the CVC to finalize purchases.

While this is a useful way to save time, it also defeats any keyloggers What Is a Keylogger? How Your Keyboard Can Betray You What Is a Keylogger? How Your Keyboard Can Betray You Hackers can see what you type into your computer---account names, passwords, and even bank details---thanks to keyloggers. Read More that sneak onto your system. Keyloggers only look at what you’re typing on your keyboard, and can’t monitor much else. As such, if you use autofill and never type your details, a keylogger can’t harvest your information.

Keeping the Physical Card Safe

Of course, all of the above points cover keeping your online presence safe. There’s plenty you can do offline to protect your debit card details too. We covered how to do this in our article about credit card fraud How Credit Card Fraud Works, And How To Stay Safe How Credit Card Fraud Works, And How To Stay Safe Despite what you may have heard, credit cards do get stolen, and credit card fraud happens, online and offline. But how does a thief get your card number, and how can you keep it safe? Read More , which also applies to debit cards.

Making the Most of Your Credit Card

Credit cards can be risky from a financial standpoint, as some people can’t resist the temptation to buy things now and pay them off later. For scams, however, credit cards are often covered by the law, don’t have significant liabilities, and won’t do much damage to your funds after a scam.

Credit cards make it safer to buy expensive tech, but did you know that there are other reasons to purchase gadgets with your credit card 4 Reasons to Always Put Tech Purchases on Your Credit Card 4 Reasons to Always Put Tech Purchases on Your Credit Card Racking up debt is never a good idea, but there are some great reasons to put all of your tech purchases on a credit card. Read More ?

Explore more about: Credit Card, Online Security, Scams.

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  1. mrazia9
    September 19, 2019 at 4:15 pm

    Obviously your,s article is one of the best.
    Simply I would like to sy we having an option that after every online transection we could block our Debit/Credit card which is upon our finger tips .
    And I personally Unblock my Debit/Credit card before online Purchasing and Promptly after successful payment I could block it just on Mobile banking app
    Its a wonderful option that we have
    Thanks
    Regards

  2. dragonmouth
    September 18, 2019 at 11:38 am

    "Be careful with anything that reveals your debit card details.
    be careful about documents stored online that contain your financial details"
    There is one minor problem with that advice. You can make your end bulletproof but what about the other end? How many individuals' records were compromised by the Equifax breach? Or the Target breach? Or the hundreds of other bank and retailer breaches? The individual has absolutely no control over the security of those databases but is nevertheless vulnerable.