8 most dangerous places to use your debit card

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By Cameron Huddleston/GOBankingRates

Making all of your purchases with a debit card is a good way to avoid spending more money than you have and racking up debt. But it’s not always the smartest way to pay. In fact, using a debit card at some places or in some instances can be dangerous.

That’s because debit and credit card transactions are processed differently. And the protections aren’t quite the same.

Under federal law, your liability for unauthorized credit card transactions is capped at $50. You’re not responsible for any unauthorized transactions if your card number — rather than the card itself — is stolen, according to the Federal Trade Commission.

You’re not responsible for unauthorized debit card transactions if you report that your card is missing before someone uses it. Otherwise, you must report unauthorized charges within two days of learning that your card is lost or stolen to limit your liability to $50.

If you wait more than two days, you could be liable for up to $500 in unauthorized charges. After 60 days you could be on the hook for all unauthorized transactions made with your card, according to the FTC. Unlike with credit cards, you have to report unauthorized transactions with your debit card number within 60 days of your statement being sent to you to avoid liability.

So to protect the money in your bank account, here are eight situations when you should think twice before using your debit card.

  • Online

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    Your chances of having your card information stolen is greater when you make purchases online because a number of e-commerce sites have been compromised, said John Breyault, vice president of public policy, telecommunications and fraud at the National Consumers League. Plus, you could easily have viruses on your computer that can capture your information as you enter it online.

    If a thief were to get your debit card information, you could contest any unauthorized charges. But that money typically isn’t available to you while the bank is investigating your fraud claim, Breyault said. With a credit card on the other hand, those funds would still be available while the card company investigates.

  • ​Hotels

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    When you check into a hotel it’s not certain what final amount you will owe when you check out will be, due to restaurant charges or other fees charged to your room. So hotels will place a hold on a certain dollar amount above the room rate, said Nessa Feddis, senior vice president of consumer protections and payments with the American Bankers Association.

    If you pay with a debit card, you won’t have access to those funds temporarily, which could cause problems if you don’t have sufficient money in your account or didn’t plan on spending more than the room rate, Feddis said.

  • ATMs at non-bank locations

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    Incidents of card and PIN skimming at non-bank ATMs — such as those located in convenience stores, hotels, restaurants or bars — soared 317 percent during the first four months of 2015 compared with the same period a year ago, according to credit scoring agency FICO.

    These ATMs typically aren’t monitored well, and owners of the establishments where they’re located usually aren’t trained to spot tampering, Breyault said. So it’s best to avoid using your debit card to withdraw cash from one of these ATMS to lower your risk of having your card information skimmed.

    Bank ATMs that look “off”

    ATMs at banks also are big targets for thieves that install skimming devices. In fact, compromises at bank-owned ATMs were up 174 percent the first four months of 2015 compared with the same period in 2014, according to FICO.

    Before inserting your card into an ATM, look for signs that it might have been tampered with, including anything that’s loose, crooked or damaged, according to the FBI. If something doesn’t look right, don’t use it. Instead, the FBI recommends using ATMs inside banks because they are less accessible to criminals looking to install skimmers.


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Christina Vixx

I was born and raised in Toronto Canada. I love writing, poetry and music. I'm a contributor for SocialMediaMorning. Make sure you follow me on Twitter and Facebook!

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