Putting strict limits on credit cards to prevent fraud

Are there any banks that allow customers to put daily transaction limits on credit cards? I’m risk averse and want to limit my exposure to fraud in case my credit card number gets leaked or stolen.

I’m not aware of any banks which place daily transaction limits on credit cards. There may be credit cards you can get through your bank which will place dollar limits on individual purchases. In other words, you might not be able to spend more than $1,000 on a single item, but you could buy multiple items.

If you were concerned about going over a certain dollar amount or wanted to slowly parcel out a spending limit over the span of your credit card’s billing cycle you could get four low-limit cards instead of one high limit card. Then only use one card for a week only. In other words, instead of having one credit card with a $2,000 limit, you could get four cards – each with a $500 limit. Then you could lock the cards you were not using.

When you have a single credit card account which is shared between multiple card holders you can place specific limits on each card. This can help you budget in a household where, for example, the kids have a $1,000 maximum limit on a card that has a total limit of $10,000. This keeps other card holders from consuming your entire budget.

While the above options can help you limit spending and keep your household under budget, they don’t address the core concern which was avoiding exposure to fraud or stolen cards. The good news is you are not liable for purchases made with a stolen card or for fraudulent purchases. You can call your credit card provider and report the card stolen. They’ll issue you a new card, confirm you didn’t make the purchases, and remove the charges from your card. Issues of fraud are usually cleared up within a few days to a week.

If you are concerned about a card being stolen and maxed out, preventing you from using the card until the fraudulent charges have been cleared, this can be addressed by keeping multiple credit cards. Keep two cards for different accounts. Carry one with you and leave the other home. If one card is compromised you can report it stolen and then use the other until your replacement card arrives in the mail.