Debit vs Credit

There are people who would tell you,  “For your financial health cut up your credit card and only use your debit card.”

I used to say,  “For your security, cut up your debit card and only use your credit card.”

Now some banks require your debit card for authentication, so feel free to keep it and use your debit card to have your bank assured of your identity.

However, never use debit card to get money from the bank or to make purchases. Why?

Too many ATM machines, point of purchase terminals, even gasoline dispensing devices get subverted to steal your purchasing card information. This information is later used to clone your card, that is to create a card that your bank cannot distinguish from yours. Skimmers (devices that crooks install to read information from your card’s magnetic strip) are usually so inconspicuous  that most people won’t notice them even when they are specifically watching for those devices. However, there is a big difference in the amount of problems created when your credit card gets fraudulently charged and when your bank account is depleted through your debit card.

In one of the latest cases ATMs in Publix supermarkets on the Florida East coast were subverted.

Even such well known places as McDonald’s can be a source of payment card fraud when they accidentally hire crooked employees – no skimmer needed.

PIN for debit cards is usually stolen using a miniature camera or a PIN pad overlay. Many merchants store your PINs together with your debit card information; that information can be stolen even if point-of-sale terminals are not subverted. Also, many places take debit cards without a PIN, especially abroad.

To save yourself a lot of headache, use a credit card.