The riskiest places to swipe your debit card

Joe Raedle/Getty ImagesDebit cards can put you at risk.

  • Debit card fraud increased by 10% from 2016 to 2017, according to FICO.
  • Since debit cards are linked to bank accounts, they don’t offer as much fraud protection as credit cards.
  • Here’s when you shouldn’t use a debit card – and when you should use cash or a credit card instead.

Swipe with caution.

While a debit card can help prevent you from racking up some serious credit card debt, it can also put you in a more dangerous situation – like the risk of identity theft or fraudulent charges.

Trust me, I know from experience.

I’ve always been an avid debit card user – I love tracking where my money goes, which seems nearly impossible to do with cash, and I aim to keep my credit utilization under 30% to keep my credit score in good standing. That said, I use my debit card for a decent bulk of my purchases or payments.

Yet, I learned the hard way that a debit card isn’t your best bet for everything.

A few days after filling up my gas tank in South Florida, I noticed some strange charges on my checking account – a few payments at different gas stations in the area and a charge at a Home Depot located in the more northern part of Florida. Since I lacked any homebuilding skills at the time (although I’m still no Bob the Builder), I knew right away these weren’t my doing.

The fraudulent charges came out to roughly $US175 – not a small sum, but it could have been worse. As a broke college student at the time, $US175 was a goldmine. I had less than $US10 left in my checking account – and I didn’t even own a credit card yet.

Luckily, my bank alerted me to the unauthorised debit card use, and after I filed a dispute form my money was reimbursed.

That was the last time I used a debit card at a gas station, which is a popular target for criminals with card skimmers.

It seems I’m not the only one who has ignored the protective benefits of a credit card and experienced the highs and lows of a debit card – in August 2017, FICO reported a 39% rise in debit cards compromised at US ATMs and merchants. For 2017 overall, 10% more debit cards were compromised in the US compared to 2016.

Debit cards and credit cards are processed differently, meaning they propose different risks. With debit cards, there’s more money at stake.

According to the Federal Trade Commission, users aren’t held liable if they report a lost or stolen debit card before unauthorised charges are made, but are held liable for up to $US50 of unauthorised or fraudulent charges if the issue is reported within two days. If you report the issue within 60 days, you may be held liable up to $US500. And if you wait until after 60 days, your maximum loss is all the money the thief took from your debit account – and possibly any other accounts linked to it.

Credit cards have better fraudulent protection. Legally, credit card users are only liable for up to $US50 of unauthorised or fraudulent activity if the activity occurs before you report it missing. According to the Consumer Financial Protection Bureau, if you report a lost or stolen card before it’s used, the card company can’t hold you responsible. If someone steals and uses your account number, you generally have no liability.

Credit cards also offer other valuable protections, such as chargebacks, extended warranties, and price protection.

Make sure to keep your checking account safe by resisting the urge to swipe your debit card at these seven risky places.

Independent or Unfamiliar ATMs

Matt Cardy/Getty Images

You may want to think twice about swiping at an ATM you haven’t used before. Today’s thieves are doing more than attaching skimming devices to ATMs to steal card information – they’re also “wiretapping,” in which they intercept card data by inserting a device through a small hole in the ATM and covering it up with a fake decal.

It’s so sneaky, it’s incredibly difficult to detect. And as Equifax points out, if you’re unfamiliar with the machine, it will be even harder for you to notice something unusual about it.

This is especially true of independent ATMs, but bank ATMs are also vulnerable. Equifax recommends opting for an ATM you know well or one inside (not outside) a bank or protected lobby.

No matter which ATM you use, don’t forget to cover your hand over the PIN pad in case the skimmer has also installed a hidden camera.

Gas Pumps

Justin Sullivan/Getty Images

As I – and others – found out firsthand, swiping your card at the gas pump is a huge no-no.

Like an ATM, they can be hacked with skimmers. External, or overlay, skimmers fit over the card reader and steal your data and PIN. Internal skimmers can be ultra thin skimmers that fit inside the card reader, or simple cables that run between the card reader and main board and record card data (wiretapping).

“A consumer may likely have no indication that they used an altered dispenser until they find a discrepancy on their bank statements,” Frank Frassetto, division administrator of Trade and Consumer protection, told ConsumerAffairs.

Use your credit card instead, but cash is even better. If you must pay with a debit card, always run it as credit and never enter your PIN.



A night out can be more costly than you think. A restaurant is one of the few places where you’re not actually doing the swiping – the waiter does it for you. When your card leaves your sight so the waiter can process the bill, you have no idea what’s going on behind the scenes.

Servers can bring handheld card skimmers to work, swipe customer card information, and use the stolen data later. Even if you pick up take-out from a restaurant without sit-down service where you pay using the card yourself, the restaurant may keep your customer information on file.

You’re best off wining and dining on cash or a credit card.


A. and I. Kruk/Shutterstock

Whether you’re on a clothing shopping spree or booking airfare online, make sure you don’t use your debit card to pay for it.

“You don’t use a debit card online,” Susan Tiffany, retired director of consumer periodicals for the Credit Union National Association, told, explaining that since a debit card links directly to a checking account, you would have “potential vulnerability” if the card number gets stolen.

Data breaches are on the rise, and the web is not immune.Both Sears and Delta Airlines suffered from online breaches in 2017.

The Identity Theft Center recommends keeping a low-limit credit card for online purchases.

Car Rental Companies

Justin Sullivan/Getty Images

It’s not unusual for a car rental company to run a hard inquiry on your credit report without your knowledge or consent. And yes, it’s legal because it’s a step they take to prevent renting cars to auto thieves.

If your score is too low, they can refuse to rent to you.

Don’t forget – a hard check on your credit can result in a lower FICO score of up to five points. It may not sound like a lot, but if you’re on the border between fair and good credit, it could be a game changer.

Your credit score will thank you for using a credit card instead.

Vacation Rental Properties

Vacation rental rip-offs aren’t uncommon; typically, scammers who target this industry post a fake listing and ask vacationers to hand over payment or a deposit in advance. Never pay up front for it with your debit card.

The last thing you want is to pack your beach bag for a weekend away only to find that the ocean view home you booked is actually a seaside shack, doesn’t exist, or belongs to owners who have no idea who you are (all scam scenarios that have actually happened) – and that you’re short the cash you paid up front.

Even if the listing is legitimate, it’s possible that vacation rental sites can get hacked. In one case, a vacationer lost $US1,880 after trying to book a vacation with Some of the property owners’ emails had been hacked on the site, and a scammer was intercepting the emails and deposit – the real owner never received either.

Since these sticky scenarios can happen, paying with a credit card will help you resolve the issue faster if it does.

The Furniture Store

Iakov Filimonov/Shutterstock

Clark Howard recommends keeping your debit card card inside your wallet when ordering furniture or appliances that need to be delivered.

After the recession, many furniture and appliance stores began closing due to the housing slump; customers who paid for their deposits with a debit card were burned when the store went out of business before they received their delivery.

Even though we’re out of the recession, and this situation may not be as common as it once was, keep in mind that recessions always recycle – and some think another recession is soon on its way.

As Howard explains, good practice involves paying for a deposit with a credit card only – if you don’t have the delivery within 50 days, put in a credit card dispute before the 60-day limit. If your purchase does end up arriving, just release the dispute.

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