One of the worst things about a debit card can seem to be the ability to get a person’s details and then use it to buy things without the person even knowing that the card has been copied. The debit card providers have seen this problem and this means that the debit card providers have a zero liability guarantee.
A zero liability guarantee is when a debit card provider does not charge for any unauthorised transactions that are made on an account. It is designed to give peace of mind to the card holder, although there are a couple of conditions. The guarantee was originally designed for credit cards and it was pioneered by the credit card processors such as VISA and MasterCard. It soon spread to debit cards.
Essentially there is the promise that the person will not be liable for a debit card transaction if the card holder has not contributed to the transaction and the card holder tells the debit card provider in a timely manner about the unauthorised transaction.
If the card holder contributes to the transaction, by for example lending his card to the person who made the transaction, then a zero liability guarantee is unlikely to be enforced. This can even include lending a card to do one small transaction and then finding that there are a number of transactions on the card. It is still a good idea to talk to the debit card provider if there is a grey area here, but the card holder should be prepared for some disappointment.
The other condition is that the card transaction is reported in a timely manner. This also means that the bank statement should be read regularly. This can sometimes be difficult with a transaction account as the bank statement also has many transactions that are not related to the debit card, such as cheques, standing orders and ATM withdrawals.
When an unauthorised transaction has been spotted then the bank that provided the debit card should be called. The bank should be told that there was an unauthorised transaction on a certain date for a certain amount. There will be some questions asked about the transaction, which will mainly centre on whether the card was given to another person. If these are answered satisfactorily then a zero liability guarantee should be activated.
