Print
(From the Financial Literacy Blog) – Each month, nearly 200 million people around the world use their devices to visit amazon.com. If you’re one of those people, you likely have your payment information saved for a more convenient checkout. If you have multiple cards linked to your Amazon account, there are some settings you may want to change. Here is a scenario to help explain why.
Let’s say you decide to make an expensive purchase on Amazon. In this hypothetical situation, you have two credit cards saved as a payment method—one with a high interest rate and one with a low interest rate. Because the purchase is costly, you won’t be able to pay off the credit card charge right away. Instead, you plan on paying it off over the course a few months. In order to end up paying the least amount in interest, you select the low-interest credit card as your payment method when checking out. Everything seems fine so far, right? Let’s throw a potential curveball in this scenario.
The credit card you checked out with gets declined. Perhaps your financial institution or credit card company flagged the purchase as suspicious, or your credit card exceeded its limit. Regardless of the reason why it was rejected, Amazon automatically charged the purchase to the other credit card saved on file. While you may have been notified by your credit card company that your purchase was declined, Amazon didn’t notify you that your other card had been charged. It’s now up to you to be proactive and make the appropriate payments on time––albeit at a higher interest rate than you were hoping for.
To explain why they will charge your backup payment in the event of insufficient funds or a declined charge, Amazon states, “Backup payment methods helps us deliver your shipments and services on time. If there is a problem with your payment, we will automatically charge a backup from your Amazon Wallet for eligible products and services.”
In order to avoid scenarios like this, you can turn off automatic backup payments in your Amazon settings. After logging into Amazon, click or tap on “Your Account.” From there, go to Your Payments > Settings > Manage Backup Payment Method. Simply turn off backup payment methods and you won’t have to worry about Amazon charging another card without you knowing.
As always, if you have any questions about your card limits or fraud detection services, contact your local credit union.