With the Black Friday shopping frenzy just around the corner, shoppers may be wondering whether there's anything they can do to protect themselves if another massive cyberattack takes place.
The short answer is yes: Use your credit card. Doing so won't necessarily protect you from getting hacked, but credit cards offer a number of features that will make life much easier if the worst happens, experts told The Huffington Post. And the same can't be said of debit cards.
"The biggest separation between credit and debit is that if something does happen with your debit card, someone can get access to real money out of a checking account that can take up to two weeks to replace," Matt Schulz, a senior industry analyst at Creditcards.com, told HuffPost. "While that money is gone, it's money you can’t spend on holiday shopping or even a rent payment or a car payment."
The hack of the U.S. Postal Service this week is just the latest in a series of high-profile cybersecurity breaches. So if you're on edge this holiday season, it's understandable. In the past year, cyberattacks have hit retailers like Target, Home Depot and Jimmy John's, among others. Sadly, consumers have little power to prevent hacks from actually happening. But you can take precautions to minimize their impact.
"In terms of avoiding having your card hacked, so much of that is out of your control, to be perfectly honest," Schulz told HuffPost. "The best thing that you can do is to take steps to protect yourself."
Or as Monica Cardone, a managing partner at eConsumerServices, puts it: "Use good old-fashioned common sense." That means avoiding ATMs where the card slot looks loose or damaged -- which may indicate the machine has been tampered with -- and making sure to check your bank account after you do some shopping. Cardone confirmed to HuffPost that using your credit card instead of your debit card is best.
Most Americans prefer to use debit cards since they can help curb overspending, but those positive effects could easily be undone in the event of a cyberattack, Cardone pointed out. Since debit cards are linked to real checking accounts and affect real money as opposed to credit lines, recovering funds lost to a security breach is a more complicated process when debit cards are involved.
For example, if your credit card gets hacked, the card issuer is required by law to cover your losses if they exceed $50. The same goes for debit cards -- that is, if you react quickly enough. If you wait longer than two days to report the loss of a debit card, the amount you're responsible for can balloon as high as $500, according to the Federal Trade Commission. Wait more than 60 days after receiving a bank statement, and your card issuer may refuse to cover any of your costs at all.
As one of the biggest shopping periods of the year, the Black Friday-Cyber Monday corridor presents a lot of opportunities for hackers. A crook can get a lot done on these days with relatively little effort, since there is such a large volume of financial data being exchanged, Cardone points out.
A survey by CreditCards.com found last month that nearly half of all shoppers plan to avoid making purchases at retailers that have recently experienced credit card hacks, like Target and Home Depot.
But these retailers may still be the safest option for shoppers, according to Cardone. Many of the already-hacked businesses have beefed up their security as a result. For example, Target is now set up for the use of new, more secure chip credit cards, USA Today reports. Other major retailers are expected to follow suit by 2015.
Companies that have been hacked "are going to take extra security measures to make sure this doesn't happen again," Cardone said. "There's likely more risk at other stores who haven't had to go through that type of scrutiny."
Wondering whether to do your shopping online or in person? Cardone said going on the Web is both safer and more convenient, while Schulz said that neither method is fully free of risk.
Recouping funds lost due to a hacked credit card is relatively easy. But what do you do if you only have a debit card? Both Cardone and Schulz said that remaining vigilant and keeping close tabs on your account balance and purchases is the best way to avoid trouble. Cardone said that frequently changing your passwords and personal identification numbers, or PINs, is also a good way to stay safe. If you can, avoid entering your PIN into things like cash registers and gas pumps -- only do it in the relative safety of a bank.
"Go to your bank and take the cash out, instead," said Cardone. "Don't put your PIN there!"
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