MasterCard Caps Debit-Card Theft Liability

MasterCard International said it wouldn’t hold consumers liable for more than $50 when a thief steals a debit card, which makes immediate payments from checking accounts. Before the change by MasterCard, the No. 2 player in the branded debit-card business, consumers were potentially liable for anything bought with a stolen debit card. Effective immediately, a person who loses a MasterCard-branded debit card, or who has the card’s identification number stolen, will only be responsible for $50 worth of charges, even if the thief uses it for thousands of dollars worth of transactions. The legal limit for fraud loss on credit cards is $50. The biggest debit card issuer, Visa International, said it has been considering lowering the liability limit on its own cards and will issue a statement about potential changes soon. Consumer groups have complained that banks and other companies are issuing debit cards with the MasterCard or Visa logo, often as replacements for ATM cards, without fully explaining that they are different from credit cards. Debit cards, also called check cards, are ATM cards that have an extra feature that allows a merchant to deduct money directly from a customer’s bank account by computer.