Many Americans use their debit card for the majority of their purchases. A report released by the Federal Reserve in December 2010 found that the debit card is the most common form of payment. No wonder it can be so annoying if a debit card gets shut down or restricted. While resolving this situation can be a nuisance, keep in mind that banks usually do this to protect users from potential fraud and mitigate losses for both the bank and the customer.
Banks have fraud monitoring programs that track your debit card spending and get a feel for what your "normal" purchasing activity is. How often you use the card, average purchase amounts and places of purchase are all used to create this record. If you suddenly have a large number of purchases that fall outside these patterns, your bank may temporarily restrict your debit card until it has verified the card has not been stolen or breached.
Where a debit card is used is a key insight into whether or not a card has been stolen. If you live in one state and the next day it's used in a place hundreds of miles away, a bank can assume that your card has been stolen and restrict the card. To prevent this from happening, it's a good idea to notify your bank that you'll be traveling at least a few days before you go on your trip so the bank can update its system and allow you to use your card while you're away.
Debit cards can also be restricted at the customer's request. Usually this procedure can be performed over the phone or in person at a branch. Possible reasons for seeking this restriction include a lost card, suspected theft or a concern that a creditor is wrongfully charging your account. Depending on your bank's policies, the same card may be reopened, or you might need to get a new one with a new number.
If you have a problem with your debit card being restricted it's best to contact your bank immediately. The bank will probably be happy to help you. Such restrictions are not intended to punish customers, but to protect all parties against fraud, which is expensive to fix. Debit card fraud is a growing problem for banks. A study conducted for the Federal Reserve and Bank of America found that debit card fraud increased 11 percent between 2006 and 2009. Calling a bank to remove a restriction is usually a lot easier solution than resolving a $5,000 fraudulent purchase.