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Dec
8
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Tara’s on a Budget: Best practices on preventing debit card fraud

As we come into the holiday season, I believe now is a good time to talk about debit card fraud. During this time of year we tend to swipe our cards a lot, whether it’s for traveling, buying presents, food, etc. High debit card use opens us up to the potential of fraud, and just last week, I was a victim of debit card fraud. I had no idea what to do, and I found myself wishing that someone had taught me how to prevent this situation. That’s why I did some research and want to share these tips with you!

Before I get into the tips, let me give you a rundown of how I found out I was a victim of debit card fraud. I received an alert on my phone asking me to verify that I was trying to use my debit card at a hotel in another state. I was so confused; I had my debit card with me, so how was this possible? After calling my dad (the man I go to with all financial questions), he explained to me what a skimmer is. A skimmer is a device that fraudsters attach to ATMs, gas pumps and other places people swipe their cards. It captures the card’s data from its magnetic strip. The data is then stored and transferred to another bank card where a fraudster is able to make purchases and withdrawal cash in the name of the actual account holder.

I was surprised to find out how frequently fraud occurs in the United States. A 2015 research note from Barclays stated that the U.S. is accountable for just 24 percent of the total worldwide card volume, yet 47 percent of the world’s card fraud.

It’s important that college students are aware of these fraud concerns and understand how to use their cards safely. Below are key practices on how to prevent being a victim of debit card fraud.

1.Sign up for banking alerts

Signing up for banking alerts is a good step to take towards fraud prevention. Alerts can be completely customizable to your personal preference. For example, I get notified any time a purchase is made on my debit card that exceeds $50. This way, if fraud were to occur, I could quickly contact my bank and prevent future purchases.

2.Only use bank ATMs

When you go to an ATM to take out cash, you need your ATM card and pin code. This is because all of your information is stored on the magnetic strip. As I mentioned earlier, this is an opportune way for skimmers to compromise your information. Fraudsters using skimmers typically target ATMs that are located away from bright lights and cameras of a bank branch. Use bank ATMs to lessen the chances your debit card will be compromised from a skimmer.

3. Use two-step authentication to login to online bank accounts

Use a two-step authentication to login to your online bank accounts. Two-step authentication means that your username and password are not sufficient for signing in. Instead, either a text message or an email with a code will be sent to you each time you log into your account. To view your funds, you must enter that code in. Although this process may seem a tad bit tedious, it’s a reliable method for preventing fraud. Always opt for the highest level security when it comes to authentication.

Debit card fraud is a real-life issue that impacts people every day. New advancements in technology, such as an EMV card, or a chip-and-pin card, are being mandated to protect your funds and data. You may have seen this type of card before; it has a small chip on it where it stores your data. Every time this card is used for payment, a unique transaction code is created. This code cannot be reused, unlike the magnet strip.

Student success planning starts with being financially responsible and improving your financial literacy. Financial responsibility goes beyond a good budget. It means taking the necessary steps in protecting your money as well. Use the practices above to prevent debit card fraud from happening to you.

Sources:  Nasdaq ;  Forbes ; Webopedia ; Bankrate ; Creditcards


Blogger Tara K.

As Blogger and budget aficionado, Tara K. helps students across the country enhance their knowledge about money management and everyday life. She is constantly looking for new ideas to transform into great advice for you. Pursuing a journalism major, Tara K. has a passion for the art of inquiry, which is conveyed through her writing.

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