Is It Safe To Use a Debit Card Online? A Guide to Overcoming the Vulnerabilities

Debit cards are frequently used as a convenient way to pay. The benefit is clear—debit cards allow you to make purchases with the money you have instead of borrowing and potentially paying interest (in the case of credit cards). But is it safe to use a debit card online? Unfortunately, not always—using debit cards online may come with inherent risks.

According to a 2020 report by Mercator Advisory Group, one fourth of consumers reported instances of debit card fraud. Out of all the payment cards sold on the dark web, around 52% were debit cards, according to a 2021 research report. These are concerning figures, especially when you consider the rise of data breaches indicating the threat of debit card fraud is likely to continue.

To help you enjoy easy and secure virtual transactions, we'll explain how to safely use debit cards online and lower the risks that accompany digital purchases.

Can You Use a Debit Card for Online Purchases, and How Safe Are They for Shopping Online?

Debit cards are typically accepted by online merchants. Paying online with a debit card is much like paying with a credit card. Here’s how to use a debit card for online purchases:

  1. Select Card or Debit Card from the options presented at checkout
  2. Type the cardholder name exactly as it appears on the card
  3. Enter the associated billing address (if asked)
  4. Provide the following card details: a) 16-digit card number; b) 3-digit CVV number; c) Expiry date
  5. Complete your payment

Making online debit card payments requires sharing your card details and other sensitive information, leaving your financial information vulnerable in the case of a data breach. When exposed, this shared data puts you at risk of falling prey to cybercrime, including identity theft and card fraud.

The stakes of becoming a victim of fraud are especially high for debit card users because your bank account is directly linked. A fraudster could quickly drain your bank account with fraudulent purchases before you even realize your debit card number has been compromised.

Source: Karolina Grabowska

Should You Use Your Debit Card Online? Important Factors To Consider

Both credit and debit cards are targeted in hacking attempts and data breaches, but debit cards may offer fewer consumer protections and may have more significant financial consequences for the cardholder. You should consider the following three factors when using debit cards online:

  1. The risk of your funds being drained 
  2. Debit cardholder liability
  3. The disputes process

The Risks of Your Funds Being Drained

If your credit card is compromised and used to make unauthorized transactions, you technically don’t lose any funds in your bank account. Instead, your checking account remains intact, and the card issuer loses the money that was to be loaned to you.

However, if your debit card is compromised, your entire account can be drained, leaving you to deal with bounced checks or overdrafts. Your regular payments may also bounce after fraud incidents, especially when you have recurring bills like mortgage and utility payments.

Some banks offer an overdraft facility, which allows you to spend more than your available balance. However, using an overdraft facility can backfire in instances of fraud and end up costing you additional fees.

Debit Cardholder Liability

While most banks have established safety protocols to monitor card transactions, users may still be held liable in case of fraudulent debit card transactions.

The Electronic Fund Transfer Act (EFTA) defines different tiers of consumer liability for debit card loss or theft based on the time taken to report the incident—here’s what to expect:

Time Period Debit Cardholder Liability
Reported before unauthorized transactions No liability
Reported within 2 days $50
Reported within 60 days $500
Reported after 60 days Potentially unlimited

If you fail to notice that your debit card has been stolen or used fraudulently within the designated period, the law doesn’t have many safeguards in place to protect you. The regulations differ for credit cards, which restrict consumer liability in the case of credit card theft.

Fraud monitoring protocols across payment networks are typically stronger for credit cards than debit cards. While credit card companies can be quick to freeze cards when they notice suspicious transactions, debit cards are less likely to be frozen after suspicious transactions.

A top-view shot of documents on a wooden table with the word scam handwritten in large font on the top paper

Source: Leeloo Thefirst

The Disputes Process

Compared to credit cards, debit cards not only offer fewer consumer protections but also have a less consumer-centric disputes process. On the surface, payment card disputes appear the same–you notify your card provider and wait for them to investigate. However, there are meaningful differences between the dispute process for credit and debit cards and how the cardholder is ultimately reimbursed.

When a credit cardholder disputes a charge, the card company immediately extends them a credit to cover the loss. If the fraud investigation favors the customer, the customer keeps the credit. Further fraud proceedings are generally handled by the credit card company because of their vested interest in protecting their funds.

Debit card disputes are handled on a case-by-case basis. Since the cardholder has lost actual funds from their account, banks are typically hesitant to extend a provisional credit immediately. In most cases, the debit cardholder gets the refund only after they’ve successfully proven that they were a victim of fraud during the investigation process.

How To Make Online Debit Card Payments Safer

To improve the safety of using a debit card to shop online, you should:

Confirm website security—Verify the:

  1. Reputation of the retailer by looking at comments and online reviews
  2. SSL certificate of the website by checking if there is a lock symbol at the upper-left corner of the address bar and if the URL starts with “https

Note: These steps are especially important when shopping with an unfamiliar website or platform or checking out with a merchant for the first time.

Use a safe network connection—Only make online payments on secure and private networks. Avoid public Wi-Fi as it’s a hunting ground for hackers.

Mask sensitive card data with a virtual card—A virtual card is a unique 16-digit card number with its own CVV and expiration date. While tied to your real bank account, a virtual card lets you complete transactions without revealing your actual debit card details or personal information to the vendor.

Source: Karolina Grabowska

Why Every Online Shopper Needs a Virtual Payment Card

Using a virtual card is one of the most effective measures for securing your online transactions. By masking your actual debit card number, a virtual card provides an added layer of security and serves as an excellent stand-in for your debit card in e-commerce transactions. Besides hiding your financial data, virtual cards often offer additional features for convenience and security to optimize the online payment process. 

The following table outlines the common benefits of virtual cards:

Benefit Description
Creating merchant-specific cards Some virtual cards allow users to create unique numbers for specific online merchants or stores. For example, if you generate a card specifically for purchases on Amazon, the card number wouldn’t work on any other website.
Setting spending limits Virtual cards can help users keep their finances under control by declining all purchases above a set spending limit. Spending limits also ensure that a potential hacker or fraudulent merchant cannot abuse the card above the designated amount.
Closing cards instantly and effortlessly Closing debit and credit cards in the event of a data breach is stressful and tedious. The cardholder must request a replacement card, wait for days to receive it, and then update their payment info across all relevant accounts. In contrast, if a virtual card is compromised, the user can typically close it instantly while their real card and bank account remain unaffected.

Keep in mind that the customization options, available features, and ease of use vary depending on the virtual card service you choose. Many banks offer virtual credit or debit cards for secure online payments, but you typically must have an account there to use the service. If you want to generate secure virtual cards instantly regardless of where you have a bank account, opt for Privacy Virtual Cards.

Reduce the Risk of Debit Card Fraud With Privacy Virtual Cards

A Privacy Virtual Card lets you take back control of your online transactions and avoid becoming a victim of debit card fraud.

Privacy is a BBB (Better Business Bureau®) accredited company that helps make your online payments secure without compromising on convenience.

Whether shopping at a reputable website or exploring a new company or product, your Privacy Card shields your primary card and account information from the vendor, significantly reducing the risks associated with data leaks. You can either generate a card that automatically locks to the merchant of your choice so the credentials are declined elsewhere or a single-use card that automatically closes after the payment is complete.

All U.S. residents over 18 with a checking account at a U.S. bank or credit union are eligible to use Privacy. You can get started with virtual cards for personal or business use within minutes—sign up and request a Privacy Card today.

Enjoy Safe and Seamless Payments With Your Privacy Card

A Privacy Card does more than conceal your funding source. The service is designed to make online shopping and managing subscriptions effortless. 

Privacy customers can:

  • Set up Merchant-Locked and Single-Use cards—Privacy lets users create unique virtual cards for different vendors. You can also set up disposable virtual cards that close after a single transaction, ensuring that a hacker cannot use it even if the card number is compromised. Privacy Cards are convenient for subscriptions, one-time donations, or sketchy websites.
  • Speed up checkout with the Privacy browser extension—Typing in debit or credit card numbers manually is time-consuming and leaves room for error. Privacy’s browser extension reduces the checkout process to two clicks—the card number is auto-filled, enabling you to complete your purchase seamlessly.
  • Manage a budget by adding spending limits—If, for example, you create a Privacy Card for DoorDash and set the monthly limit to $100, transactions beyond that limit will automatically be declined. Since Privacy also enables you to share virtual cards with trusted family members, the spend limit feature is perfect for helping manage your kids’ online spending as you remain in total control of the funds.
  • Close, pause, or unpause cards—Privacy users can easily close or pause virtual cards with a single click without impacting their bank account or credit score. This functionality is convenient for managing subscriptions because Privacy automatically declines recurring payments on paused or closed virtual cards. Note that you still need to reach out to the vendor to cancel the subscription.
  • Get real-time notifications—Privacy’s Android and iOS apps notify users about transaction activity in real-time and make it easy to manage virtual cards anytime, anywhere.

Create Your First Privacy Card in Four Easy Steps!

Here’s how to set up your Privacy account:

  1. Access the signup page
  2. Complete the onboarding process
  3. Connect your bank account (or debit card)
  4. Generate a virtual Privacy Card—and you’re ready to transact!
Close-up shot of hands holding a black iPhone as the user browses apparel on a retail shopping platform

Source: cottonbro studio

Privacy’s basic service allows you to create 12 new cards every month as part of the base tier. If you need more cards, you can opt for Pro or Premium plans and generate up to 60 virtual cards per month. Pro and Premium users also earn 1% cashback on eligible transactions up to $4,500 in spend per month. Check out the Privacy plans to see what works for you.

Privacy is PCI-DSS compliant and adheres to other industry safety standards, so you are protected by the same security protocols that are leveraged by banks. Although Privacy Cards are inherently designed with security in mind, in the instance you do not recognize a transaction, you can file a dispute directly through the Privacy dashboard. Our team will carry out a full investigation and manage the dispute/chargeback process on your behalf.

Create your Privacy Card today and take charge of your online payments!

Privacy — Seamless & Secure Online Card Payments
Checkout securely online by creating unique virtual card numbers for every purchase. Avoid data breaches, unwanted charges, and stolen credit card numbers.
Sign Up