One of the big advantages of debit cards is that they can be used to pay for goods online in the same way as a credit card can. However many debit card users are worried that they may be opening themselves up to being defrauded if they do use their debit card online. Although this was an issue in the early years of the internet, there have been a number of things that have been done since then that make the use of debit cards online far safer than they were before.
Debit cards are processed by VISA and MasterCard, who started out as credit card processors. They also use the same identification codes as credit cards. The big difference is that instead of having a separate interest bearing account in the way a credit card does, the debit card accesses a bank account. Although traditionally these have been transaction accounts they can be savings accounts, loan accounts, flexible mortgages, lines of credit or even the cash element of a share investment account.
Debit cards, like credit cards before them, only need to use the numbers that are stored on the card, not the card itself. This means that they can be used remotely, which as well as the internet means that they can be used for telephone ordering and mail order. However there is one big disadvantage to this and that is that they can be easily copied and transmitted.
One worry that people have about giving out debit card information on line is that their details will be compromised and passed on. This used to be a big problem at the start of internet commerce, and there is still a public awareness that this is an ongoing issue. However a number of things have been done to stop this.
Firstly debit card issuers have insisted that sites that do take credit cards have rigorous security and protect any debit card details. This has meant that there has been the growth of shopping carts which are third party providers who process the debit cards so that web sites can take credit card transactions without needing to process them or store any details, which the shopping cart does.
There is also a zero liability guarantee where the card processor will not charge unauthorized transactions to a bank account as long as the card holder tells their bank of the transaction in good time.
