You may have noticed a new sponsor lately. Yep it's Visa. You might recognize them from such places as the logo on the cards in your wallet, and the signs on a door of a shop. In fact it's just about everywhere (you want to be) ;-). Anyway, I found myself with the opportunity to pass on a couple of nuggets of information about debit cards.
- Q: What's the best way to earn rewards on a debit card?
Ask your debit card issuer if they offer a debit rewards program. Often, issuers will pair up with a partner like an airline or hotel to give you the ability to earn points on a debit card toward rewards you care about. Some financial institutions also offer the ability to earn points for qualified purchases that can be redeemed through an online catalog, for items like gift cards, airline vouchers and hotel accommodations. It's important to understand how you can earn points toward rewards "“ what purchases qualify, whether you earn points when you enter a PIN or sign for your purchases, etc. Make sure you ask these questions of your financial institution.
My take: I have to be honest, I didn't really expect them to say that you could earn rewards on a debit card. I get nothing from my Bank of America account. However maybe it's possible with these high interest 5%+ Interest checking accounts. That article is a few months old and 5% may be tougher to get now, but it seems like a good way to get some rewards.
- Q: Is a debit card as safe to use as a credit card?
Despite the popularity of debit cards, consumers are often confused about the security features and consumer protections debit cards offer. As a matter of fact, many of the same features and protections provided by their credit card are also offered with debit cards. Protections which guard cardholders from fraudulent or unauthorized charges, like "Zero Liability" are typically in effect when a cardholder signs for their purchase or makes a purchase online. Consumers can also see timely replacement of funds from their financial institution, in the unlikely event of fraud, and also have the ability to dispute debit card charges should an issue arise with a merchant regarding your purchase "“ just as you would with a credit card.
It is important to continually monitor your monthly statement to identify any unauthorized transactions. If you notice fraudulent activity on your card, you should contact your financial institution as soon as possible and report it "“ this may help to reduce your liability.
I don't make a lot of debit card purchases, but when I do it seems like it's almost always with a PIN number, not a "Zero Liability" method like signing. For that matter, I'm surprised that purchases online qualify for zero liability. It brings up the interesting question of whether I need to be prompt in reporting fraudulent activity when "zero liability" protections are in effect. I'd love to "help to reduce my liability" from zero.
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