Kimberly Shearer is a credit cards enthusiast, family travel blogger and mom of three boys who lives in the Philadelphia area. She is an extreme couponer turned points and miles enthusiast who loves using credit card points to spoil her family on nea.
Kimberly Shearer Credit Cards WriterKimberly Shearer is a credit cards enthusiast, family travel blogger and mom of three boys who lives in the Philadelphia area. She is an extreme couponer turned points and miles enthusiast who loves using credit card points to spoil her family on nea.
Written By Kimberly Shearer Credit Cards WriterKimberly Shearer is a credit cards enthusiast, family travel blogger and mom of three boys who lives in the Philadelphia area. She is an extreme couponer turned points and miles enthusiast who loves using credit card points to spoil her family on nea.
Kimberly Shearer Credit Cards WriterKimberly Shearer is a credit cards enthusiast, family travel blogger and mom of three boys who lives in the Philadelphia area. She is an extreme couponer turned points and miles enthusiast who loves using credit card points to spoil her family on nea.
Credit Cards Writer Dylan Pearl Credit Cards EditorOver a decade of editorial experience across a number of publications and more than 60 countries visited have given Dylan Pearl a wealth of travel knowledge, and the tools to effectively communicate that knowledge to others. Dylan has made it his mis.
Dylan Pearl Credit Cards EditorOver a decade of editorial experience across a number of publications and more than 60 countries visited have given Dylan Pearl a wealth of travel knowledge, and the tools to effectively communicate that knowledge to others. Dylan has made it his mis.
Dylan Pearl Credit Cards EditorOver a decade of editorial experience across a number of publications and more than 60 countries visited have given Dylan Pearl a wealth of travel knowledge, and the tools to effectively communicate that knowledge to others. Dylan has made it his mis.
Dylan Pearl Credit Cards EditorOver a decade of editorial experience across a number of publications and more than 60 countries visited have given Dylan Pearl a wealth of travel knowledge, and the tools to effectively communicate that knowledge to others. Dylan has made it his mis.
| Credit Cards Editor
Updated: Jan 18, 2024, 11:48am
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Fraud Liability And Do All Credit Cards Have It?" width="100%" height="145px" />
Zero fraud liability, a policy many credit and debit cards advertise to consumers as a safety measure against theft or fraud, seems like a stand-up thing for card companies to do. Federal Law requires consumers not be liable for more than $50 in charges that result from lost or stolen card information. This means that many credit card holders are not responsible for unauthorized purchases—at least for more than $50.
Zero liability remains a standard inclusion for many consumer cards in the U.S. However, corporate or large business card servicers are not legally required to offer zero liability for their cardholders. Even if they do, business card holders should also practice caution when giving card access to employees or adding them as authorized users. Any charges racked up by a disgruntled employee do not usually count as fraud (because the employee is the one using the card) and will not be protected. Always double-check the details of a card’s liability protection by calling the number on the back of a credit or debit card or by checking the issuer’s website.
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In most cases, any fraudulent purchase made on a covered credit card is protected by zero liability no matter the size and no matter how the purchase was made—in-person, via phone, mobile device, ATM or online. It’s up to the credit card holder to report fraudulent charges to their credit card issuer as soon as the charges are discovered. Then the servicer will remove or cancel any unauthorized purchases after conducting an investigation and restore funds. Typically, the cardholder will not be liable for any fraudulent charge. However, if a credit card does not offer $0 liability, cardholders may be liable for up to $50 in charges.
The four major credit card networks in the U.S. cover cardholders with a zero liability policy. Each major network is outlined below. Remember to double-check this information with a particular card issuer, as terms and conditions change regularly.
Visa credit cards are covered by $0 fraud liability protection. Some commercial and prepaid cards are not protected.
All credit cards are protected.
Consumer credit cards offer $0 fraud liability protection. Commercial cards and unregistered prepaid cards are not protected.
Credit card liabilities refer to the financial obligations that individuals or businesses have incurred through the use of credit cards. When a person makes purchases or incurs expenses using a credit card, they essentially create a liability to repay the borrowed funds. This liability includes the outstanding balance on the credit card, which typically accrues interest if not paid in full by the due date.
Some debit cards offer similar zero liability protection but it greatly depends on which type of card and details surrounding the discovery. The Electronic Funds Transfer Act limits a cardholder’s liability to $50 if the debit card holder notifies the bank within two days of discovering fraud or after losing their card. If the cardholder waits longer than two days, then they may be liable for up to $500. If the cardholder waits more than 60 days, they may be liable for the entire amount. Always read the fine print and call the bank to ensure any card’s protection.
Credit and debit card companies offer zero liability for every eligible cardholder. But if the cardholder is not in good standing, they may not receive the same level of protection. If you are delinquent on payments, wait too long to file a claim or irresponsibly share card information (e.g. sharing pins with multiple people), you may be liable.
Credit card liabilities encompass not only the principal amount borrowed but also any additional fees, interest charges and penalties associated with the normal use of the credit card. It’s crucial for cardholders to manage their credit card liabilities responsibly to avoid accumulating excessive debt and to maintain a positive credit history. Understanding and staying aware of one’s credit card liabilities are essential aspects of financial literacy and responsible card management.
Regularly review account statements and account activity online to catch fraudulent charges. Enabling mobile alerts offers a convenient solution, with real-time updates on purchases made or suspicious activity. Many credit or debit card issuers also offer complimentary fraud monitoring services via text, phone or email alerts. For example, if the cardholder resides in Los Angeles, California, and suddenly there are three purchases made in Madrid, Spain, the card issuer may contact the cardholder immediately to verify suspicious charges. Contact a card issuer to see if they offer this service.
While there is no way to guarantee your account will never be the victim of fraud, there are some steps you can take to help prevent fraud.
Sometimes opting to use a credit card to make purchases instead of a debit card is the best form of protection. Skimming machines installed by thieves can rip card information when the cardholder innocently buys something. If a credit card is skimmed, it’s much easier to handle fraudulent charges because money has not been stolen directly from a bank account. Instead, the cardholder simply loses access to that credit line until the issuer resolves the incident and sends over a new card.
Another way to help against fraud is to check your account activity regularly either online or on a mobile app.
You can also regularly check your credit report to make sure no new accounts have been opened under your information. There are plenty of ways to check your credit score for free.
Lastly, remember to call the bank or card issuer to confirm that they offer zero liability protection.
No single credit card is the best option for every family, every purchase or every budget. We've picked the best credit cards in a way designed to be the most helpful to the widest variety of readers.
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Credit Cards WriterKimberly Shearer is a credit cards enthusiast, family travel blogger and mom of three boys who lives in the Philadelphia area. She is an extreme couponer turned points and miles enthusiast who loves using credit card points to spoil her family on nearly free vacations. She has been perfecting the fine art of traveling with kids since 2009 and uses her blog, podcast and social media to teach other parents how to travel more for less.
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