Making the Most of Debit Cards

Protect your business by taking all security precautions when using debit cards

Debit card incentives, such as a free card with a new checking account, make the idea of having a debit card sound great, but there is risk involved and you must know how to use them properly. If someone else gets their hands on your debit card and you don’t take the right precautions to protect your business funds, someone could empty your accounts very quickly.

However, there are a number of steps you can take to assure the utmost protection of your assets. Successfully using debit cards involves the following:

1. Use a PIN for debit card transactions as often as possible.

2. Make sure that your PIN is a number is difficult to figure out.

3. Watch your accounts regularly through statements, online and by mail to avoid overdrafting through debit card use.

Make secure purchases using debit cards

While there are always risks, debit cards are one of the safest ways of making purchases with your business checking account. Most providers of debit cards give you the option to use your debit with a personal identification number (PIN), signature or both. For added security, you can assure no unauthorized purchases by requiring PIN approval only. Then the only person that can use the card is you. Using your PIN with debit card transactions means that the merchant automatically withdraws funds from your account through an online processing system. If you sign a receipt, like with a credit card, the withdrawal may take two to three days to process instead.

Choose an appropriate PIN for your debit card

It's best to choose a PIN for your debit card that isn't associated with any other important numbers in your life. Therefore, don't use birthdates, anniversaries, the last four digits of your social security number, address or phone number. A smart thief with the right resources can obtain enough information about you to try these numbers and access your account. Remember to never write your PIN on your card or keep it in the same place. If you can't memorize it, write it down somewhere safe as a reminder only, far away from the actual card.
Federal Trade Commission provides the steps to help recover lost funds.

Take care not to overdraft with your debit card

While the funds in your checking account limit the amount of transactions you make with your debit card, you can still overdraft if you don't watch your account balance carefully. Just like bouncing a check, a delay in depositing funds combined with too many transactions over a short period of time could mean extra fees charged by your bank and the merchant. These overdraft fees typically range from $25 to $50, which the bank will charge to your account automatically.
The Federal Reserve Board. Apply for a debit card online through a debit card provider like Bank Midwest.

• You can prevent the possibility of overdraft with prepaid debit cards. You can only spend the amount you deposit in the account, with no exceptions. Be sure to choose free prepaid debit cards that don't require activation or deposit fees.

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