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Business Account Debit Card Legal Issues

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Question: 
What are the legal drawbacks for offering debit cards on Business Accounts?
Answer: 

You should be careful not to provide the same disclosures you provide consumers for their debit cards, since the same rules won't apply. Regulation E doesn't apply to business debit cards, and you should make that clear in your contract language. If you plan to issue Visa business debit cards, you should be aware of Visa's requirements for a modified zero-liability coverage plan, and make sure you include appropriate language in your contract. From there, you should involve legal counsel to structure the agreement in such a way as to control the bank's exposure to card fraud and unauthorized transfers.

First published on BankersOnline.com 4/10/06

First published on 04/10/2006

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