How safe are credit cards?
No one wants to lose money or be a victim of fraud. Here’s why credit cards are the payment method that will keep you the safest.
Considering how rampant fraud is and that a new major data breach is announced seemingly every few months, security is more important than ever. When you’re picking your primary payment method, there are several key reasons why a credit card is the smartest choice.
- They’re not connected to your money
Since credit cards aren’t linked to your bank account, they provide an extra layer of security. When your credit card is used, it’s the card issuer that’s paying for the transaction, at least until you pay the bill.
If you were to lose your wallet, you wouldn’t need to worry about someone draining your bank account, like they could with your debit card. You’ll just need to contact your card issuer to get a replacement credit card.
- You have limited to zero liability for fraudulent charges
Fraudulent charges are a hassle, but at least with a credit card, there are consumer protections that will limit your liability. Here’s what the Fair Credit Billing Act stipulates regarding credit card fraud:
- Fraud alerts notify you if your card is compromised
Card issuers now let you provide your phone number to register for fraud alerts. Once your card issuer has your phone number on file and your consent to receive texts, they will send you a message for any suspicious transactions, such as larger-than-usual purchases.
These alerts can be a big help if your credit card number is compromised and you don’t realize. Instead of having someone else use your credit card without your knowledge for days or weeks, you’ll know right away and can cancel the card.
- Your card issuer will freeze disputed transactions
Whether you’re disputing a transaction because it’s fraudulent or due to an issue with the product or service, the dispute process will be more convenient for you with a credit card. It goes back to how your credit card isn’t linked to your money.
- Chip technology makes it harder to steal your credit card data
By now, all the major card issuers in the United States have moved on to chip cards. That’s good news from a security standpoint, because the difference between magnetic strip and chip technology is like comparing an unlocked front door to a bank vault.
When you consider how much safer and more convenient it is to pay by credit card, it makes sense to use one as your primary payment method. Carry a little cash if you think you’ll need it, but otherwise, carrying only a credit card puts you at a much lower risk than carrying a wad of cash or a debit card everywhere you go.