Yes, debit cards are targeted by hackers more frequently than credit cards, as they were the top payment method for fraud attempts in 2024, with roughly 73% of financial institutions reporting such attempts. Debit cards are riskier because they provide direct access to bank account funds, whereas credit cards offer superior fraud protection and limited liability.
The bottom line. From a legal perspective, credit cards generally provide more protection against fraudulent activity. But, there are ways to mimic some of these protections with a debit or prepaid card. Deciding which is best for you will help protect your money whether you're spending online or swiping in store.
Credit Cards Are Generally Safer
In terms of fraud protection, chargeback rights, and overall impact on your bank account, credit cards provide a much safer option compared to debit cards.
Credit cards aren't linked directly to your cash, so they are much safer than using a debit card. Once the cash is taken from your bank account, you can't get that back, but if someone steals your credit card info and makes fraudulent charges, no cash is missing and those charges can be disputed.
Either scenario is stressful and a burden. However, debit card fraud might be arguably worse. Why? With credit card fraud, you can usually dispute the charges with your credit card company and not be held responsible for any fraudulent charges.
Here are some of the most secure payment methods available online:
When you bank or shop on public Wi-Fi networks, hackers can use keylogging software to capture everything you type, including your name, debit card account number and PIN. That is why it is important to be careful online by always using secure websites with private Wi-Fi when shopping or banking.
Keep your cards secure: Never share your card details with anyone, and report lost or stolen cards immediately. Use strong passwords: Ensure all your online accounts have long, complex passwords and enable two-factor authentication where possible. Be sure all your online accounts have different passwords.
The 2/3/4 rule is a guideline, primarily used by Bank of America, that limits how many new credit cards you can get: no more than 2 in 30 days, 3 in 12 months, and 4 in 24 months, helping to prevent over-application and manage hard inquiries on your credit report. While not universal, it's a useful benchmark for responsible card application, though other banks have different rules (like Chase's 5/24 rule).
Use a credit card for payments (if you have one). Many of these protect online purchases as part of the Consumer Credit Act. Debit card payments offer less protection, but you might be able to make a claim for a refund under a voluntary scheme called 'chargeback'.
Unlike debit cards, certain credit cards provide benefits like complimentary card insurances, that offer added security measures when you travel. These cards can also be linked to reward programs through airlines or stores, and you earn points based on purchase types and amounts.
If you paid by card or PayPal
Your card provider can ask the seller's bank to refund the money. This is known as the 'chargeback scheme'. If you paid by debit card, you can use chargeback however much you paid.
Cons of debit cards
While a security freeze can help protect you by preventing certain access to your credit reports if someone attempts to open a new credit account in your name, it can't help protect you against other forms of fraud, such as a stolen credit card number.
5 places you shouldn't use your debit card
Skimmers are small devices criminals attach to traditional card readers to steal data from swipes or chip inserts. Since Tap to Pay doesn't use the stripe or the chip slot, these types of attacks are significantly reduced when you use contactless.
What Is the 15/3 Rule?
Identity thieves can retrieve account data from your card's magnetic strip using a device called a skimmer, which they can stash in ATMs and store card readers. They can then use that data to produce counterfeit cards. EMV chip cards, which are replacing magnetic strip cards, are expected to eliminate this risk.
Although scanning a card with a mobile skimmer while the card is in your wallet is theoretically possible, it is not common. Skimmers have to be very close to your card to work, so using an RFID wallet can't take the place of being careful and practicing safe habits when you're out and about making purchases.