Debit or credit: Which offers greater protection?

Debit or credit: Which offers greater protection?

Debit or credit: Which offers greater protection?

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by Jeff Maher / KXTV

kvue.com

Posted on February 5, 2014 at 4:47 PM

Updated Wednesday, Feb 5 at 4:56 PM

The security breaches at Target and Neiman Marcus likely have many individuals contemplating how to best protect themselves from fraud or data breaches. One key issue to consider is whether it's safer to use credit or debit cards for purchases?

Both credit and debit cards offer solid protection in their own ways, but with credit, when it comes to theft and fraud, customers have a better chance of getting their money back. Another concern is how long it will take for a bank or credit card provider to respond.

According to CNN Money, if you have your information stolen from your debit card and the thieves drain your account, it could take up to two weeks for your bank to have funds restored to that account.

"I know people love their debit cards. But man oh man, they are loaded with holes when it comes to fraud," John Ulzheimer, credit expert at CreditSesame.com, told CNN.

With credit cards, fraudulent charges can be reversed immediately, Ulzheimer said.

Whether it's credit or debit, security experts urge vigilance in terms of monitoring balances and statements. According to Yahoo Finance, under the Electronic Fund Transfer Act, consumers are not responsible for more than $50 if a lost debit card or fraudulent charge is reported within two days. If the loss is reported within 60 days the liability jumps to $500. After 60 days, the victim may be liable for all losses.

For customers remaining loyal to their debit cards or lacking access to credit, there are certain places to be extra careful when swiping. Outdoor or freestanding ATM machines and gas pumps can be fitted with near-imperceptible skimming devices fixed to the card slots. When a card is inserted, the data is stolen.

When using an ATM, it is always recommended to cover up the keypad with when entering the PIN, because thieves have been known to position cameras above the ATM's to get PIN and card information.

The recent security breaches at major retailers have proven there is rarely a case where a customer can feel invincible when it comes to data theft. That being the case, individuals need to take every effort to limit damages if and when attacks happen.

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