Capital One has created a new kind of debit card, and the company is hoping it will replace traditional debit cards or even credit cards. This new debit card can be linked to any account at any bank and can be used for purchases or ATM withdrawals. There will be no fees, and Capital One will offer rewards similar to their credit card program.
Consumers who have a Capital One credit card, for example, will be able to pool their rewards from the two products, earning the same level of points, miles or cash back no matter which type of card they use.
Right now, the new debit card is in the process of being offered to those who hold credit cards with Capital One, but it will be later be available to the wider marketplace.
The main problem I have with debit cards is the lack of consumer protection. If my debit card is stolen, my bank account can be drained, and the banks may not credit my account until conducting an investigation. That’s a scary proposition. This debit card apparently offers a benefit similar to credit cards.
If the card is stolen and fraudulently used, consumers should contact Capital One, not their bank. Capital One will reimburse the fraudulent charges to the linked checking account within a day.
This is not enough protection for me. If my number is stolen, not my card, then I’m not going to know that any fraudulent charges have been processed until I see a statement or check my activity online. While I normally check my activity almost every day, not everyone does so, and I can’t be confident that I will always have the ability or time to do so. I think I’ll stick with credit cards (and paying off the balance each month) for now.
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