According to data compiled by the FTC, consumers reported more than 68,000 cases of debit card fraud in 2022, amounting to almost $196 million in losses^[1]. With numbers like these, banks and card issuers are understandably enhancing their security and dispute mechanisms to protect their customers.

However, filing a debit card dispute isn’t always straightforward. Unlike credit card disputes, debit card disputes can be more restrictive and take longer to resolve. You’re also not guaranteed a chargeback, which can leave you frustrated when trying to recover your money. Understanding your rights and the correct steps to take is crucial in protecting your finances.

In this article, we’ll show you how a debit card dispute works, covering topics like:

• When you can dispute a debit card charge
• How to dispute fraudulent charges on a debit card
• How long you have to dispute a debit card charge
• Why debit card disputes can be challenging 

We’ll also explain how virtual cards can protect your debit cards from unauthorized and excessive charges.

When Can You Dispute a Debit Card Charge?

Debit card disputes are governed by the Electronic Funds Transfer Act (EFTA), which provides specific protections for unauthorized transactions and errors. Under the law, the following are valid reasons to dispute a charge on debit cards^[2]:

• You didn’t authorize a charge.
• The amount transferred to or from your account is incorrect.
• A transfer doesn’t show up on your account statement.
• The bank made a math or bookkeeping error with an electronic transfer.
• You got the wrong amount of money from an ATM.
• A transfer doesn’t show up in your records the way it should, or you asked for documentation or more details about a transaction.

Can I Dispute a Debit Card Charge That I Willingly Paid For?

Debit card transactions made willingly don’t qualify for a dispute under the EFTA, which usually centers around errors and unauthorized charges^[3].

For example, these error resolution procedures might prevent you from filing a complaint about the quality of merchandise or services you bought using a debit card. Meanwhile, you normally have that right with credit cards.

However, some banks or card networks might give you additional coverage under their voluntary zero-liability policies. Always double-check with your issuer for their specific debit card dispute rules.

How To Dispute Fraudulent Charges on a Debit Card

Debit card disputes are mostly similar to credit card disputes in terms of the steps involved, with some minor differences when it comes to the timeframes and movement of funds. Here’s the process to dispute a charge on your debit card:

1. Try Resolving the Issue With the Merchant First

Before filing a dispute, you should first try to amend the issue directly with the merchant. Since chargebacks come with non-refundable fees and other operational costs for the merchant, it’s in their best interest to work with their clients and issue a refund if it’s a genuine error on their part.

Even for cardholders, contacting the merchant and requesting a refund is usually the fastest and easiest way to resolve a dispute.

Banks might even require you to keep records of communication with the merchant before you can file a debit card dispute, which makes this step essential. Make sure to document as much information about the conversation as possible, including:

• Name of the person you spoke with
• The date and time you got in touch with them
• Email or chat logs with the merchant
• The resolution proposed by the merchant

2. File the Dispute With Your Bank

If the merchant rejects your claim or isn’t responding to your communications, you may proceed to file the dispute with your bank or card issuer.

You can file a dispute with your bank by calling them, sending an email, or filling out an online form. Even if you submit the dispute online or verbally, banks may still ask you to write a formal letter within 10 business days of the oral dispute^[4].

Sending a notice in writing is a good practice as you’ll have proof of your request. To ensure a smooth investigation and have the best chances of winning the dispute, include these essential details in your letter:

• Your name, address, and account information
• The merchant’s name
• Date, type, and amount of the error
• Detailed explanation of the error or reason for the dispute
• Supporting documents and evidence, such as receipts, billing statements, or proof of shipment or delivery dates

3. Wait for the Resolution

After submitting a debit card dispute, banks have 10 business days (20 days for new accounts) to investigate and report back to you. In case the banks require more time to complete the investigation, they can extend it to 45 days provided they issue a “provisional credit” within the 10-day period^[3].

The temporary funds will be credited to your bank account until the dispute is completed. If the dispute is successful, you keep the funds (including interest, if applicable). However, the provisional credit is reversed if the outcome isn’t in your favor.

This process is similar to what happens in a credit card dispute—the main difference is that with credit cards, provisional credit shows up as available credit, while for debit cards, the temporary funds are deposited directly into your bank account.

How Long Do You Have To Dispute a Debit Card Charge?

The EFTA lays out the following timeframes for filing disputes along with the liabilities associated with them^[3]:

1. If a debit card is lost/stolen—You should notify the bank within two business days after learning that your card has been lost/stolen to limit liability to $50 or less. If you notify the institution after two business days but within 60 days, liability may increase up to $500.
2. If a debit card isn’t lost/stolen—You’re not liable for any fraud charges if you notify your bank within 60 calendar days of receiving the statement containing the unauthorized transaction.

In both cases, if you report the transaction after 60 days have passed, you might be liable for any unauthorized charges that occurred after those 60 days. However, you should still be able to get reimbursement for the charges made in the first 60 days. 

Your bank might also have its own liability policy that extends the coverage and timelines outlined in the EFTA. 

Why Debit Card Disputes Can Be Challenging (And What To Do About It)

Debit cards typically offer fewer consumer protections compared to credit cards and consequentially have a less customer-centric dispute process.

For instance, where credit cards have a consistent $50 liability cap thanks to the Fair Credit Billing Act^[5], you may be held responsible for a much higher amount if unauthorized charges occur on your debit card.

Another disadvantage is that debit cards are directly linked to your bank account, so fraudulent transactions can affect your available balance, potentially causing overdrafts or missed payments unless the bank issues provisional credit. And even when you do everything correctly, the dispute process can be lengthy, and there’s no guarantee your claim will be resolved in your favor.

To avoid these challenges, consider using virtual cards. By shielding your actual card or bank account information and protecting you from potential card fraud, virtual cards help you avoid many of the reasons for filing disputes in the first place.

However, with so many virtual card providers out there, it can be difficult to choose one that fits your needs. While many banks and card issuers like Citi^®, Capital One^®, and American Express^® offer virtual cards, they require you to have an account with them to use their services.

If you want to generate virtual cards seamlessly regardless of your bank account, opt for a specialized virtual card provider like Privacy, which also gives you robust security features that reduce the risks of unauthorized charges, subscription-related accidental charges, and billing errors.

Avoid the Hassle of Disputes With Privacy Virtual Cards

Privacy is a Better Business Bureau^® (BBB) accredited company trusted by over 250,000 users. By linking your bank account or debit card to your Privacy account, you can generate virtual cards with random card numbers, CVVs, and expiration dates for secure online transactions.

You can use Privacy Cards like your regular credit or debit cards to transact online while protecting your real payment card information from potential hackers.

Privacy lets you create three types of cards that come with different measures to help protect you against unauthorized charges:

You can set spending limits on each virtual card, and Privacy will deny any charges exceeding this amount. This feature helps protect you against hidden fees and duplicate charges.

Privacy lets you pause, unpause, and close your virtual cards at any time. This can be an effective measure to block unexpected charges that may occur even after you’ve canceled a subscription.

Easy Dispute Resolution Process Using Privacy

In case of actual issues related to charges on your Privacy Virtual Cards, you can still file a dispute using Privacy as follows:

1. Visit your Privacy dashboard and select the transaction you want to dispute.
2. Select the type of purchase (goods, services, or unknown).
3. Explain the reason for the dispute in detail.
4. Submit any relevant evidence supporting your claim.
5. Sign the dispute form.

Privacy will then carry out the investigation and handle the entire dispute process on your behalf.

Additional Convenience Features of Privacy Cards

Privacy Virtual Cards come with several other benefits that make card management and online shopping seamless. You can install the Privacy Browser Extension, available for Chrome, Firefox, Edge, Safari, and Safari for iOS, to generate new cards or autofill your virtual card details for faster checkouts without the need to manually enter card details on every website.

Privacy also offers mobile apps for iOS and Android devices to manage your virtual cards on the go. You can enable push notifications, and Privacy will notify your device whenever your virtual card is used or declined, helping you detect suspicious transactions promptly.

Other convenience features include:

• 1Password integration—Create new Privacy Cards, save your card details, set spending limits, and autofill payment details directly from the 1Password browser extension.
• Card Sharing—Share virtual card details with trusted friends and family members to share your budget without the risk of exposing sensitive information.
• Card Notes—Add custom labels to each virtual card for better organization and tracking. For example, you can add custom notes for the subscription renewal dates.

How To Sign Up for Privacy

To join Privacy, you must be a U.S. resident over 18 years and have a checking account at a U.S. bank or credit union. If you meet the criteria, you can request a Privacy Card in four simple steps:

1. Visit the signup page
2. Enter the mandatory KYC details
3. Connect a funding source to your Privacy account
4. Request and generate your Privacy Virtual Card

You can choose from four plans depending on your specific needs:

Resources

^[1]Federal Trade Commission. https://www.ftc.gov/system/files/ftc_gov/pdf/CSN-Data-Book-2022.pdf, sourced January 31, 2025

^[2]Consumer Finance. https://www.consumerfinance.gov/rules-policy/regulations/1005/11/, sourced January 31, 2025

^[3]Federal Reserve. https://www.federalreserve.gov/boarddocs/caletters/2008/0807/08-07_attachment.pdf, sourced January 31, 2025

^[4]Idaho Legal Aid. https://www.idaholegalaid.org/sites/idaholegalaid.org/files/Protections%20for%20Debit%20Card%20and%20Electronic%20Transactions%20Fact%20Sheet.pdf, sourced January 31, 2025

^[5]United States Code. https://uscode.house.gov/view.xhtml?req=granuleid%3AUSC-prelim-title15-chapter41-subchapter1-partD&edition=prelim, sourced February 1, 2025

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