Digital payments and cards are fast overtaking cash as the main way of buying items and most kids and teens are familiar with what a payment card is. So it's no wonder that parents worry about teenagers using their credit cards without permission.
Let's take a look at some of the most common concerns of credit or debit cards being used without permission, including the consequences, how to get a refund, and how to discourage your children from doing it again. Read on for answers to the most common questions below.
Reasons why your child or teenager wants to use your credit or card in the first place
With the rise of the internet and the popularity of in-app purchases, online shopping, and social media, kids have never been more exposed to different ways to spend money. If your child doesn’t understand the value of money, they may be tempted to use your card without understanding the consequences of their purchases. Teenagers may use your card for new items or social activities they can’t afford, even if you haven’t given permission.
A teenager may be using their parent's card for:
In-app game purchases
Movies, apps, and other digital media
Buying food, clothes, or other desired goods
Entertainment and social meetups
Regular purchases since they can’t get their own credit card
Curiosity about how credit cards work
What are the consequences of your child using your debit or credit card?
There are several risks if your child uses your card online—and these can be serious. The main issues are that your child could spend your money and put you into debt without your knowledge or permission, which can have long-term effects on your finances, especially if your children buy expensive things.
Other consequences go beyond unexpected debt. One major risk is that kids or teens may not be able to tell which websites are safe to use. Alongside making an unauthorized purchase, your children could risk having the card details stolen, opening you up to identity theft or fraud.
Using credit cards, in particular, can also encourage children to keep making purchases without having to think about the cost, especially if they don't understand how credit cards work. They could therefore pick up bad financial habits for their future. Since children can't have their own credit card, any time they use one should be a positive teaching experience for the future.
Can you get a refund for unauthorized charges made by your child?
Technically, it's not allowed for children to use their parents' credit cards at all, but this doesn't always stop them. It can be a difficult situation for credit card companies, banks, or shops to assess because sometimes parents let kids use their cards, but sometimes it's done without permission. This means that it's not guaranteed that you will get a refund for unauthorized charges that your child has made, but you should still try.
Are there any purchases for which parents won’t get a refund?
While most refund cases side with the parents, that’s not always the case. If you added your child as an authorized user on your credit card, you’ve already permitted them to make purchases on your account. Once your child is an authorized user, the credit card company allows all charges made by your teen as if they were you, legally. If you choose to add your child to your credit card account, make sure they clearly understand how they can use the card and the consequences of using it to make a purchase.
Steps to get a refund for unauthorized charges made by your child
One of the main ways that kids use their parents' cards is in online game stores, app stores and similar. In most cases, you can request a refund directly from the vendor. Depending on how and where your child made the purchase, check the refund policy at Apple or Google Play, or stores like Microsoft, Sony, or individual game companies like Roblox — usually you’ll be eligible for a refund within a set timeframe.
If this isn’t an option, it’s worth contacting your bank or credit card provider to see if they can stop the unauthorized charge. Some banks might insist that you go through proper crime reporting systems to report what has essentially been theft and fraud.
If you’re past the refund period, bear in mind that many companies have disclaimers protecting them from refunding unauthorized purchases made by children using their parents’ cards.
How to discourage your child from using your debit or credit card
1. Check your statement regularly - Look at your statement regularly to see if your child has used your card. If they have, you'll be able to address the problem quickly, increasing your chance of getting a refund.
2. Remove saved payment information - It can be tempting to leave payment information on online shops for convenience, but removing it makes it harder for your child to make purchases. This is especially important if you put in your card details to buy your child a game or app on their device.
3. Educate your child about the consequences - The best way to stop kids from making bad purchases is to educate them. Explain that making payments on your card is taking away your money, and say what else it would be used for if they hadn't spent it. This is the best way to make sure that they are ready for their own credit card one day.
4. Set passwords and parental controls - Set up password protections if you share devices with your child. Take advantage of parental controls that allow you to turn off or monitor purchases on your child’s account. On Apple devices you can also set up ‘Ask to buy’, which sends a request for parents to approve when a child wants to buy or download a new item.
5. If you do add your kid as an authorized user on your credit or debit card, set clear guidelines for their authorized card use - Credit card companies will hold you liable for the charges, so make sure your child or teen understands your expectations for how they should use the card.
6. Get your child their own prepaid debit card - Giving a child the ability to spend their own money online can be massively helpful to teach them about wise spending. If you're unsure whether your kid is ready for a debit card, a prepaid debit card is a great option.
A GoHenry prepaid debit card is a great way to stop your child from using your card online. Plus, our other benefits for teens include quick payment of allowance to their card, as well as our in-app Money Missions, teaching them how to spend money wisely, and to safely spend money online.