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2-min read

Online Safety for Credit and Debit Cards

In case of an online fraudulent transaction, there is something called a chargeback process, where the customer can complain against a wrong transaction.

Updated:April 30, 2019, 1:55 PM IST
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Online Safety for Credit and Debit Cards
In case of an online fraudulent transaction, there is something called a chargeback process, where the customer can complain against a wrong transaction.
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Time is money. This statement has never held more truth than in the fast paced digital world we all live in today. Be it a menial task like getting groceries or a big task like transacting a huge sum of money from one account to another; there are new and enough ways of getting it done faster, and at the customer’s convenience. Everything is online now. There is also no need for a big fat wallet anywhere you make purchases, be it online or offline. A simple debit card or a credit card is all you need, to carry out any sort of financial transaction.

But as it does, every technology comes with its pros and its set of cons. Worrying about the safety of your bank account is legitimate, since there are various ways in which frauds can occur. Since nowadays a majority of financial transactions take place through debit/credit cards, it begs the question; which one is safer to use?

With the two factor authentication in place for both cards, there isn’t that big a difference when it comes to online safety. Hackers or frauds don’t discriminate between credit and debit cards. While both are equally prone to online frauds, it is the process after the fraud that might be different. And in such a case, there is a higher risk factor with your debit card. Here’s why.

Since a debit card is directly linked to the customer’s bank account and contains all the money, there are chances the fraudster might wipe it all off before there is an alarm raised from your end. In case of a credit card, it is the line of credit that gets wiped off, which is not the customer’s money, but belongs to the bank that issued the card.

Simply put, with debit cards you lose your money, and with credit cards, you lose the bank’s money.

Also with credit card frauds, the most the hacker can siphon off is what your credit limit allows; which one can get back on informing the bank in due time. In case of your debit card being hacked, all of your own money irrespective of any limit can be withdrawn.

Also if the hackers have access to your current bank account, they also get direct access to any other savings accounts linked with it, leading to further problems.

In case of an online fraudulent transaction, there is something called a chargeback process, where the customer can complain against a wrong transaction. This needs to be done within a stipulated time period. In case of debit card fraud, necessary investigations are undertaken by the customer’s bank, and at the end if deemed appropriate, the lost amount is credited back. In case of credit cards, the decision can be changed before the next billing cycle and thus the customer wont need to pay the amount back.

The recent announcement by RBI that allows tokenization of credit and debit card transactions is a welcome move, which will definitely add to the safety factor. Till then, it’s imperative to stay aware and cautious of online frauds, be it a credit or debit card.

To know more, click here.

This content has been created in association with YONO SBI

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