When you return an item or find a debit-card charge on your account you didn’t authorize, you want the money returned to your bank account immediately. Unfortunately, it doesn’t work that way with debit cards. The Electronic Fund Transfer Act allows banks up to 10 business days to decide whether or not to issue a refund to your bank account. This means funds you’re relying on to pay your bills may be delayed.
When you make a debit card purchase, the money is transferred out of your bank account to the merchant. The bank cannot issue an immediate refund to your debit card because your money is no longer there. The merchant must release your funds back to the bank first before the funds can be credited to your account.
Dispute vs. Fraud
Unanticipated charges on your debit card can be very frustrating, but there’s a big difference between filing a dispute regarding charges made with your debit card and claiming fraud. If you know the person to whom you made the transaction on your debit card, if you signed up for a free trial with a company or if you voluntarily loaned your card to someone, it’s typically not considered fraud. A charge is usually only categorized as fraudulent if you’ve never done business with the merchant or you don’t know the person who used your debit card.
Speeding the Process Up
To move the refund process for fraud or disputes along faster, it’s important to be properly prepared. If you’re filing a fraud claim, double-check the forms to make sure you’ve filled everything out correctly. When paperwork has to be sent back because it’s incorrect, it takes longer to process. For payment disputes, provide the bank with all the relevant information you have to back up your claim, including a cancellation number, e-mail or anything else you have in writing.
Purchases Not for Debit
Using a debit card for purchases from certain merchants provides a greater risk than others. Sometimes it’s safer to use other forms of payment such as PayPal, cash or a credit card to safeguard your bank account from fraud. At establishments such as gas stations, restaurants and online stores, it’s best not to use your debit card.
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