Today, people use the Internet to make online payments, shop, pay bills, bank, and invest for the future. Before using your credit or debit cards to pay for something over the Internet, read this article to learn more about the online payment process.
Making Online Payments
While most people use their credit cards to make online payments, debit cards are also becoming increasingly popular. With a debit card, money is directly withdrawn from your checking account. Be wary of using a debit card instead of your credit card because the financial institution that issued the debit card may limit their liability for a lost or stolen card. This may mean you will be held responsible for purchases made by a thief.
Most banking institutions also offer online bill paying services. With these services, you can have certain monthly bills automatically paid by your bank. The bank will simply deduct the amount of the bill from your designated checking or savings account. These services simplify bill paying and can save consumers a great deal of time.
Security is the Key
The key to making payments online is making certain that your personal financial information remains secure. Savvy thieves prey upon unsuspecting consumers and use the Internet to steal passwords, account numbers, social security numbers and other personal financial information. With that information in hand, an identity theft can easily pretend to be you and ruin your credit and good name. The following are some basic tips for keeping your information secure when making online payments:
- Check the website's privacy policy. Every reputable website includes a privacy policy letting the public know if they plan to give your information to others.
- Use a secure browser. This means you may have to install software on your computer that will encrypt or scramble your personal information when sending it over the Internet.
- Keep personal financial information private. Don't tell anyone your passwords, account numbers, or social security number unless you contact the person yourself. Don't respond to unsolicited requests for this information.
- Give personal financial information only to businesses you can trust. Businesses that have stores and businesses that have been around for a long time are usually the most reputable. Be cautious of websites and businesses that look like they cropped up overnight.
- Keep copies of all your records and emails. Hang on to things like confirmation numbers and the names of any customer service representatives you speak to.
- Check your credit card and bank statements promptly. This way you will notice any fraud or errors right away and request an investigation.
Understanding Your Rights
There are laws that will protect you when you make online payments. For example, the Fair Credit Billing Act and the Electronic Fund Transfer Act protect against lost or stolen credit and debit cards. These laws require that financial institutions like credit card companies and banks establish procedures for resolving errors on your bank and credit card statements. The Federal Trade Commission will help you if your bank or credit card company is not following the law regarding security of your online payments.
