Debit Cards

Over 35 million Debit cards have been issued in the UK and there are a further 25 million credit cards most of which can also be used to get cash. With over 12,500 cash machines available, Debit cards have generally made life easier. But they have also brought problems. The Jack Committee reported that ATM disputes (in other words, disputes concerning the use of Automated Teller Machines or cash machines) are running at a rate of one every hour in the UK. ATM disputes are the largest area of work for the Banking Ombudsman and the second largest for the Building Societies Ombudsman after mortgage related disputes.

Lost or stolen cards You are particularly vulnerable in the case of Debit cards because they fall outside the legislation that covers other payment methods such as credit cards or cheques. So the banks and building societies have largely written their own rules and have put an enormous obligation on you as cardholder. Usually, you are liable for all transactions authorised by the cash card. This means that you are liable for all amounts paid out through use of the card whether or not you were the one using it. The liability ceases once you notify the bank or building society that your card is lost or stolen or likely to be misused for some other reason. Some card issuers - but not all - limit your liability before notification to a maximum sum, such as £100. The Jack Committee has recommended that your liability should be limited in this way with all Debit cards ).

WARNING If your cash card is lost or stolen, notify your

bank or building society at once. But note that phoning, or even going to your branch in person, is not enough by itself You must confirm the notification in writing (by fax if you like) and normally within a given time limit - for example, seven days. There are several card notification companies which for a fee keep a record of all your card numbers and will ring all your card issuers if your cards are lost or stolen. This is a potentially very useful service since you need to keep only the emergency phone number of the notification company rather than those of all your card issuers. But the legal position regarding these notification services is not entirely clear: will all your card issuers accept notification from the company, do you still need to confirm the notification yourself and how rapidly, who's liable if the notification company makes a mistake? Check these points with the bank or building society which issued each of your cards before you rely on a notification service.

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Standing Orders And Direct Debits

The technical banking term for standing orders and direct debits is 'pre-authorised payments'. In other words, they are arrangements agreed in advance and in writing for the payment of given amounts at given times. Your bank or building society will continue the pattern of payments until you instruct in writing that they be altered or discontinued - you may be required to give a period of notice. Standing orders are the older of the two systems but have to some extent been superseded by direct debits which now account for one in eleven of all non-cash transactions.

Standing orders This... see: Standing Orders And Direct Debits

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