Learn how to use Debit Cards Safely
I have an uncle who belongs to the old school of thought; he is always well organized and prepared for all situations. He always scoffs at our habit of running to the ATM to make a withdrawal before we head out.
He regards all cards as unsecure, total nuisance and useless (except business and greeting cards l.o.l)! But as luck would have it – one day on his flight he misplaced his luggage.
He was left with some cash which he had anticipated would be enough for the trip; a paltry distress allowance given by the airline and the realization that maybe a debit card would have been handy! These cards are like a bank in your pocket and if used properly are quite handy!
What is a Debit Card?
Before getting into the security features of debit cards, let’s understand debit card basics. Debit cards are plastic cards that are issued by banks to their account holders; these cards are linked to the customer’s account. As the name suggests these cards make an instant debit to the customer’s account and allow him to make a purchase using the balance available in his account.
Apart from this the debit cards also allow the customer to withdraw money from their accounts from the ATM machine (Automated Teller Machines).
Debit card transactions are limited by two features:
• Per day limit of your card (this limit varies from bank to bank and within the same bank from card to card)
• The balance in your account.
So in case you have Rs. 50000 in your account and you want to withdraw Rs. 40000 but your card has a per day withdrawal limit of Rs. 25000, then you can withdraw Rs. 25000 on one day and Rs. 15000 from the branch or wait till post midnight and withdraw the money from the ATM.
This limit is per day and not per transaction.
Debit cards may or may not be charged, this is dependent on the bank’s policies, and they are issued only for savings account and not for fixed deposit accounts. Some banks may issue these cards for current accounts (proprietorship) too and for minors also the rules may vary from bank to bank like ICICI bank issues cards for kids above the age of 7 with a withdrawal limit of Rs. 1000/2500/5000.
Each bank offers a variety of cards with types like premium/platinum/gold/silver or may be special cards for senior citizens/women/privilege customers.
Comparing ATM Cards and Debit Cards
The difference between these two is that ATM cards can be used only to access the ATM and not to make a transaction at POS.
Comparing Credit Cards and Debit Cards
Credit cards offer you a line of credit; when you use the credit card you are in fact taking a loan from the credit card company and you have to repay the loan as per the terms and conditions agreed upon.
Credit card usage is limited to the credit limit set by the credit card company and in case you withdraw cash using this card you have to pay an interest on the withdrawal amount.
Security features of a debit card
Let’s learn about debit card security. So what are the security features of a debit card? Debit cards are convenient but in wrong hands they can cause a lot of damage to the account holder. These cards usually come in with a few security features which are listed below:
1. PIN Number:
Each card can be used in combination with the Personal Identification Number (PIN) for cash withdrawal.
2. CVV Number:
For transaction on the internet or through IVRS you have to give the CVV (Card Verification Value) number to validate the transaction.
On the backside of the card there is a strip where the card owner needs to sign; this is counter checked with signature on the customer copy when you make a purchase at a POS.
Some cards may have the photograph of the card holder as an additional security feature.
5. Per day limit:
Each card has a per day limit for the amount of withdrawal and swiping; this ensures that your loss is restricted in the event of you misplacing the card.
6. Card Blocking:
In case the pin number is entered wrong three times the card is automatically blocked and can be unblocked only after contacting the bank; you can also block the card by contacting the bank in case you lose it.
7. Card and Pins are kept Separate:
The banks assure that the card and pin are always sent separately and at a gap; even in case they are undelivered and returned to the ban they are always kept in the custody of separate people to minimize the probability of misuse.
What you must remember while using debit cards
There are certain things that the bank does to keep you safe but you as a customer must also be careful. Here are a few things that you can do: They will help avoid debit card security risks.
1. Always Sign on the reverse of the Card
As soon as you receive the card make sure that you sign at the required place. This is for your safety.
2. PIN Number
Writing the PIN number on the card or on a paper in your wallet or on the cover of the card are recipes for disaster so please desist from doing this. Also choose your PIN number carefully, change it after the first transaction and keep updating it from time to time.
3. Keep the Helpline Number Handy
All cards have the helpline number printed on them; but if you lose the card and want to contact the bank at night then you are stuck if you have not noted down the number somewhere else.
4. Call the Helpline Immediately
In case you lose your card call the helpline immediately to inform them and get your card blocked. Helplines are faster than emails and branch staff!
5. Apply for Mobile Alerts:
This way whenever your card is used you will get an alert and will be aware in case of misuse.
6. Be Vigilant
You need to be extra vigilant when you hand over your card for swiping as card cloning is a very serious and rampant threat. You should make sure that you card number is not noted down or your card is not photocopied.
7. Follow Rules
This rule does not directly apply to the safety of the card but when you travel abroad make sure you find out about the rules pertaining to card use internationally.
If despite following rules and exercising reasonable caution you face a problem and you do not get a satisfactory response from the bank you can approach the banking Ombudsman. The Banking Ombudsman is a senior official appointed by the Reserve Bank of India to redress customer complaints against deficiency in certain banking services.
You can get a list of banking ombudsman at this site and you can contact your nearest nodal centre.