Debit cards are a convenient way to pay for things in person, online or over the phone but there are times when things can go wrong somewhere along the line.

Whether it is from fraud or an electronic processing error, incorrect debit card transactions could show up on anyone’s statement.

While they are not incredibly common, it does pay off to know what to do if you think you have an unauthorised transaction on your debit card.

Steps To Resolve Debit Card Transaction Errors

If you think you have found a mistake, the first thing to do is get as much information about the transaction in case there is another explanation for the charges.

People who keep receipts, for example, may find that a mysterious debit card charge it is actually one they made but has a different reference or merchant name on the statement. You might have noticed it in your app, or you’ve received a push notification about a transaction you don’t recognise.

Purchases made overseas, on the other hand, may not include the exchange rates and that could also lead to a difference in the expected charge and the actual amount debited from the account.

Banks like Westpac suggest that when the name of the merchant does not look familiar, and you are unsure of the amount, try searching for the company online to see if it is connected to another one that you may have made a purchase with.

If you do find yourself needing to dispute a transaction, hopefully these steps will help you out.

Step 1: Contact the merchant.

This is the first and easiest option to resolve the dispute. They may be able to issue a refund or correct the mistake on the spot. Remember to be polite, clear and persistent. If there’s a genuine mistake, you might just get your money back straight away. If the merchant doesn’t want to play ball, you might have some protections under the Australian Consumer Law (ACL).

Step 2: Contact your bank.

If the merchant is uncooperative with your request for a refund, your next step should be contacting your bank (or the institution that supplies your debit card). Find out what details they will need to dispute the transaction, such as receipts, merchant ID’s, time, place etc.

Your bank should subscribe to the Banking Code of Practice, which is a set of enforceable rules that everyone in Australia can expect from their banks. The Banking Code of Practice covers things like responsible lending, fair and transparent communication, and complaint handling.

If your bank is not a member of the Australian Banking Association (ABA), it may still follow a similar code of conduct, such as the Customer Owned Banking Code of Practice, which applies to credit unions, building societies and other lenders that are not banks. The Customer Owned Banking Code of Practice also sets standards for ethical behaviour, fair treatment and responsible lending.

The bank should now be working on your behalf to dispute the transaction with the merchant and their payment solution provider. Keep an eye on your inbox for any updates.

Step 3: Seek external assistance.

This is really the last resort to take if you feel you are entitled to a refund and you aren’t getting anywhere with your transaction dispute. The good news is there is a body called the Australian Financial Complaints Authority (AFCA). The AFCA can investigate, mediate, or adjudicate the dispute. They can help you resolve your complaint in a fair and impartial way, without going to court.

The outcomes that you may get will vary depending on the nature and circumstances of your complaint. Some possible outcomes include:

• – Compensation for any loss or damage you suffered as a result of the disputed transaction
• – An apology or explanation from the business
• – A correction or reversal of the transaction
• – A refund, exchange or repair of a faulty product
• – A cancellation or variation of a contract
• – A change in the business’s policies or practices

You should also keep any evidence that supports your complaint, such as receipts, statements, correspondence and photos.

Does the law protect you?

The ACL is a national law that guarantees consumer rights when buying goods and services, including financial products and services. The ACL also protects consumers from unfair practices such as misleading or deceptive conduct, false representations, and unfair contract terms. Depending on the nature of your dispute, you may be able to rely on some of these consumer protections to resolve the issue with the merchant or your bank. Let’s say for example, the product or service you paid for was not of acceptable quality, not fit for purpose, or not as advertised, you may be entitled to a repair, replacement or even a full refund under the ACL

Australia also has something called the ePayments Code. This is a voluntary code of practice that regulates electronic payments, including debit card transactions. If your bank or payment provider subscribes to the ePayments Code, they must comply with its obligations and provide you with certain remedies if something goes wrong with your transaction. Check your banks website to see if they subscribe to the code.

Next steps?

But for charges that you are still unsure of, the following steps can help sort things out:

1. Contact the bank or debit card provider by phone, fax or in person and explain the transaction
2. Wait for information or letters from the provider acknowledging the dispute and investigation
3. Review any merchant documentation that the provider passes on
4. Decide whether the transaction still needs to be disputed
5. If it does, respond to the merchant documentation and wait for more information from the provider

When the debit card provider deems a transaction to be unjustified they will generally perform a chargeback so that the amount is debited into your account and the situation is resolved as quickly as possible.

In some cases they may even temporarily credit the account with the amount disputed while they look into the situation, but this will depend on the bank you are dealing with.

One of the best ways to make sure your debit card is only charged when you use it is to regularly check your statements, keep receipts and records of your purchases, and use secure payment methods such as PIN or contactless. That way you can keep your finances in order and rest assured that your money is right where it belongs.