ATM & Debit Cards

For many bank accounts, banks can issue you debit cards, in the form of basic Automated Teller Machine (ATM) cards, that let you obtain 24 hour access to money in your bank account through ATM cash machines, or more sophisticated debit cards that let you use ATM machines plus use your debit card for purchases.

When you use a debit card, funds come directly out of your bank account (just like writing a check). And because ATM withdrawals and purchases are listed on your monthly statement you can track your spending.

Your bank will provide you with a personal identification number (PIN) to use with your card, which is essentially a password for electronic access to your account. With your debit card and PIN, you can withdraw cash, make deposits, or transfer funds between bank accounts, and pay for retail purchases with certain cards.

When you withdraw cash, some ATMs charge a fee if you are not a member of their network or are making a transaction at a remote location. ATMs must disclose the fee on the terminal screen or on a sign next to the screen.

Report a lost or stolen ATM or debit card to the issuer immediately. If you report an ATM card missing before it is used without your permission, you are not responsible for any unauthorized withdrawals. Federal regulations limit your liability to $50 if you report the loss within two business days after you realize your card is missing, and to $500 if you report the loss between 2 and 60 days. Under Federal law you could lose all the money in your bank account and the unused portion of your line of credit established for overdrafts if you fail to report an unauthorized transfer or withdrawal within 60 days after your bank statement is mailed to you. However, self-imposed industry rules limit your liability to zero if you report the loss within two business days, and to $50 if you report it more than two business days after realizing your card is missing.

Purchases made with a debit card are handled in one of two ways: either you enter your personal identification number, as you would at an ATM, or you sign for the purchase, similar to a credit card transaction. Ask for a debit card that must be used with a PIN to make it harder for thieves to use your lost or stolen cards or account numbers.

Keep your PIN a secret. Do not write your PIN on the card or on a slip of paper kept with your card. Take your ATM receipt after completing a transaction. Reconcile all ATM receipts with bank statements as soon as possible.

When you use a debit card for purchases, these purchases will be shown on your periodic statement from your bank account. If there is an error on your account, contact your bank or the issuer of the card at the address or phone number the company provided. When you use an electronic funds transfer, federal law does not give you the right to stop payment. It is up to you to resolve the problem with the seller.

Stored-value cards, issued by some financial institutions and merchants, contain cash value stored electronically on the card itself. Stored-value cards and the transactions you make using them may not be covered by the Electronic Funds Transfer Act, which means you may not be covered for loss or misuse of the stored-value card.