COLLEGE STATION — Debit and ATM cards are joining credit cards in pocketbooks across the nation to offer consumers another way to handle money. But the new cards are not without responsibilities.
“Consumers need to know that debit cards and ATM cards are riskier than credit cards,” warned Dr. Lynn White, an economist with the Texas Agricultural Extension Service.
While credit card losses are limited to $50 per card if reported promptly, debit card losses can go up to $500 if not reported within two business days.
“Losses are unlimited if not reported within 60 days after the bank sends a person’s statement,” added White.
One exception to this rule is that debit cards bearing a Visa or MasterCard logo are required to cap losses at $50.
Another challenge of ATM and debit cards is that since these cards draw money directly from the bank account, is person is without the money while the reported theft or loss is being investigated by the bank, she noted.
“In contrast, charges to credit cards are suspended until the loss claim is investigated,” White said.
Students also need to be careful with the ATM cards or debit cards offered through their university or college.
Texas A&M University at College Station offers students the Aggie Card, a student identification card with debit and ATM functions.
The debit function is part of the Aggie Bucks program, administered through Texas A&M. Program administrator Steven Pace said students can call a 24- hour hotline to have Aggie Bucks suspended in case of loss or theft.
“There is also a clause that limits a student’s liability,” Pace said.
ATM access is offered through local financial institutions.
Tim Wallace, manager of Norwest Pavilion Center, sets up ATM capabilities on Aggie Cards through Norwest Bank.
“People need to learn the financial responsibility of having a card with such convenience. You have to watch your balances and be careful,” he cautioned.
There are other steps students can take to protect themselves, he added.
First, read account disclosures. Know the rules for using the card. If possible, use a card with a photo of the owner on the front. Never give out the card’s PIN number, and call the financial institution immediately if the card is lost or stolen.
“The ease of convenience with this new card is not to get students in trouble. We want them to practice financial responsibility.”
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