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Paying with plastic isn't what it used to be. For the first time, Americans are spending more money on debit cards than credit. With debit cards, consumers are paying with money they have, not money they're borrowing - a positive thing in these debt adverse times.

But, as NPR's Martin Kaste reports, the debit card's growing dominance means Americans need to learn a new set of rules.

MARTIN KASTE: You might remember this Visa commercial from a few years back.

(Soundbite of Visa commercial)

(Soundbite of music)

KASTE: The scene is a deli where customers and clerks juggle orders in a perfectly synchronized ballet of commerce. What keeps things running so smoothly? Why, everyone's paying with a debit card, of course.

(Soundbite of Visa commercial)

Unidentified Man #1: Because money shouldn't slow you down. Life takes faster money. Life takes Visa.

KASTE: That commercial is rapidly becoming reality. Last year, for the first time, spending on Visa logo debit cards overtook spending on Visa credit cards, not just the number of transactions, but also the total dollars spent.

Professor ANITA RAMASASTRY (Law, University of Washington): You go to the grocery store and, you know, 10 years ago, maybe I would've written a check to pay for things at Trader Joe's, but now I use a debit card.

KASTE: Anita Ramasastry is a former Federal Reserve lawyer. Now she's at the University of Washington law school where she specializes in payment systems. She says younger consumers, especially, have embraced the debit card, in part, because it looks so familiar.

Prof. RAMASASTRY: It looks pretty much like a credit card. Would you agree, yeah?

Unidentified Man #2: Definitely.

KASTE: The fact that a debit card has the same kind of number as a credit card means it could be used to buy things in person with a pin code or signature, or if you go online, without a pin or a signature. On some Web sites, that debit card number plus the expiration date is enough to buy you, say, a new TV, just like a credit card. But in cases of fraud, the two kinds of card are not identical.

Prof. RAMASASTRY: With credit cards, by law, my maximum liability for an unauthorized transaction is $50. For debit cards it's a more tiered structure.

KASTE: Time is a factor - the longer you take to report fraud on your debit card, the less money you're guaranteed to get back. When it comes to debit cards, the law is simply less forgiving, something Ramasastry says doesn't make much sense, since people use the two kinds of card interchangeably.

In practice, many banks do offer credit card-style fraud protection on their debit cards. Bill Sheedy, president of Visa North America, says that's the case for cards bearing his company's logo.

Mr. BILL SHEEDY (President, Visa North America): We have provided to consumers of Visa debit cards or credit cards a higher level of protection. And the requirement for our issuers, who issue those cards to consumers, is that they provide zero liability and immediate credit to consumers if there is a dispute.

KASTE: But that extra protection for debit cards is voluntary. Groups like Consumers Union say it's time to put the industry's best protections into law. At Visa, Bill Sheedy doesn't think consumers are that worried.

Mr. SHEEDY: The trends are clear. The consumers and merchants want to transact in an electronic form, and we think Visa debit is a big part of that.

KASTE: Still, not everybody's on board with debit cards. Remember that commercial? It culminates with a disaster at the cash register, when one poor schlub fails to produce the expected debit card.

(Soundbite of Visa commercial)

(Soundbite of music)

KASTE: Dave Ahrens remembers that scene.

Mr. DAVE AHRENS: The guy who slows everybody down is the one paying cash.

KASTE: That's you.

Mr. AHRENS: That's me, always.

KASTE: Ahrens just paid cash for a tea at a Seattle Starbucks, and he sits down to explain why it is he won't allow his bank to create a debit card in his name.

Mr. AHRENS: I work in information technology, and I could tell you that it's really tough for somebody to ensure that your data is going to be handled properly.

KASTE: He just doesn't see the need for that 16-digit number to exist, especially if somebody might use it to clean out his bank account. He prefers to get his cash from the teller in person once a week. In these austere times, he says, there's nothing better than a wad of cash to help you keep track of your spending.

Martin Kaste, NPR News.

HANSEN: To read more about the differences between debit and credit cards, go to npr.org.

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