Be Judicious When Using Debit Cards

Problem with Debit Cards

Debit cards are linked directly to your bank checking account and as such you’re really spending your own cash the moment the card is swiped by the merchant for the product or service you are purchasing.
Now, on the one hand this is a good thing because you are spending your own cash and you are not incurring debt, as you would be if you were using a credit card. On the hand, the banks are not as willing or speedy in giving you the same protection for debit cards as it does for their own credit cards. Some banks offer little or no protection.

Illegal Use of My Debit Card

For example, I recently had a $50.06 electronic transfer charge appear on one of business bank accounts that I happened to checking online. It had an 888 number which when I called, I was informed that it was for a long distance reverse charge (call-collect) that someone had made using my debit card. $50 for a collect-call – that must have been one heck of a call! But that’s not all…

Not only there was one $50.06 charge that had already been processed, but there was another one pending! The telephone company informed me that they couldn’t refund the money; I had to call my bank and dispute the charges.

I called my bank and they were very sympathetic, but they also had a process in place to dispute debit card transactions. They were going to send me a affidavit, via snail mail, that I needed to sign and return to them and then they would look into the transaction.

They also stated that the affidavit is only for the charges that have been processed. In other words, the pending $50.06 would have to be dealt with separately. I would have to call the bank back and request another affidavit, also via snail mail, and then they would kindly look into that transaction as well for me. Don’t you just love banks?

The Bank “Process” For Debit Cards Is Not Customer Friendly

Well I went through “process” that the bank had conveniently setup for its customers and I did eventually get $100.12 refunded to my checking account. But the whole process took over 6 weeks! That was 6 weeks that my account was over $100 short. Now, can you imagine if each of the transaction had been $500 instead of $50? How many smally businesses carry an extra $1000 in their accounts? I know mine doesn’t.

I did ask a very important question when I was speaking, trying to keep calm, with the bank customer service lady. The question was “If this was a credit card instead of debit card, would it have made a difference in the process?” And the answer… yes, I would have been done with just one call. No affidavits, no waiting 6 weeks, and most importantly, not being out of $100 for over 6 weeks. The refund probably would have been made within 24 – 48 hours!

The reason for the lack of protection or speed of service from the banks I suspect is because when you use a debit card, you’re using your own money. With credit cards you’re really playing with the banks money. Would you be more inclined to provide more protection and speedier service if it’s your money involved rather than someone elses? I know I would, and that is exactly what the banks are doing here.

The banks have always had their interests ahead of their customers. And they always will. So be careful about using debit card like a credit card.

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