Debit vs Credit card: In terms of choosing the card for making any payment
in our daily basis, many people get in confusion whether to choose Debit Card or
Credit Card. In terms of choosing the best one, many of us get in disorientation
whether to prefer the debit card or credit card. So, these terms create great
confusion to us with the great question mark, credit card vs debit card
or the difference between credit card and debit card. It is the reason why many people get confused in terms of choosing the card mainly debit cards
and credit cards. So, here we are going to clarifying out what is the difference
between credit card and debit card (credit card vs debit card) in
long and clear details.
Debit vs credit card:-
Physically both the card
either debit card or credit card looks the same so it is sure to identify without
reading the details of the card. Both cards contain 16digit numbers with their
date of validation and the name of the cardholder. Due to this physical, it is
difficult to find out difference between a credit card and debit card.
Another reason for the difficulty in finding out which is a debit card and which is the credit card is due to the same payment policy. In the time of making payment both
the card has equally important and acceptable almost everywhere so it is
difficult to find out whether the user people are making a payment with his debit
or credit card. In this situation, many of us including you and me are in
confusion about credit card vs debit card and find out what's the
difference between a credit card and debit card?
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| credit card vs debit card |
Have you ever been
confused about debit vs credit card? Yes! Many of us are still in
confusion about the difference between debit and credit card. Due to
this confusion, many people are in search of how does a debit card differs
from a credit card. So, before finding out the difference between credit
card and debit card it is necessary to find out what is a debit card
and what is credit card.
What is Debit Card?
Debit card is a payment
card or payment method used in the time of paying a certain bill after the
service, purchase and affording the assets from the store, market and online
strategy. It is a payment method that helps to make a payment of any services
and after purchasing anything by deducting the amount from the account holder’s
bank account. It offers the convenience of credit cards but works in its own way
and process. The debit card pays the money for anything from the bank account. It
means that there is the inter-connection of a debit card with a bank account. All
the payment which are done through the debit card is auto deducted or get minus
from the bank account of the debit card users.
In a simple way, Debit card
is a prepaid service as like prepaid SIM card where the users have to fill out
or deposit a certain sum and balance to subscribe to any services. Debit card is
the payment policy where the users have to deposit the certain sum of the amount or
balance to get any services.
Features of Debit Card
We can get some
significant features before finding out debit vs credit card, form debit
card which makes you focus on why I am using a debit card instead of a credit card.
1. Prepaid Service
The first feature that we
can find in the debit card is that it is a prepaid service. As like prepaid SIM
Card, a debit card is also like prepaid service. In a prepaid SIM card, we have
to collect the balance to use and subscribe to any plan before using it. For
example, if we want to subscribe a data packs then we have to pay out a certain
amount of balance recharge. Without paying out the balance we are not able to
subscribe to the plans. So, as like prepaid SIM Card in terms of the debit card we
have to deposit a certain SUM in our bank account to use any services.
2. Free to Use
Debit Card is free to use.
We can use this card everywhere to make payments. But be sure that the store
must have the facility to accept such types of cards. In terms of rural areas, it
is not possible to make a payment using a debit card or any such types of cards.
In the city area, it is easy and free to use such cards to make payments.
3. Interest-Free
Another well-known feature
of the debit card is interest-free. Yes! A debit card is interest-free, it’s a charge-free card. One can make a payment easily using a debit card. The main reason for
saying debit cards as interest-free is that the cardholder doesn’t need to pay interest to the bank for using debit card amount. It is because the debit card is
our own money. So, to use our own property and money does we do need to pay for
others? No.
features of debit card
4. Immediate payment
To make any payment using a debit card is fast and reliable. The cardholder can make a payment of any
services, goods or purchase materials immediately. So, to make an instant
payment many account holders used to prefer debit cards.
5. More Acceptable
Debit Card has a nature of
more acceptable. It means that in almost all card-accepting stores debit card
is accepted. So, it is easy to make payment using a debit card to any people
having this card.
6.
Own Balance
The main features of debit
cards are that the balance of the debit card is our own balance it’s not a
bank’s balance but it’s a bank balance. So, all the amount that we pay
using a debit card is automatically deducted from our bank balance.
Therefore, it is more freedom to use balance because to use own balance there are no types of restrictions.
Therefore, it is more freedom to use balance because to use own balance there are no types of restrictions.
Also Read:
What is Credit Card?
Credit Card is a type of
plastic money which is issued by the bank to the account holders to make a
payment of any purchase and services. It is a payment card like the Debit Card
where the account holders need to pay the expenditure of any services by borrowing
the bank’s balance. Credit Card enables the cardholder to borrow funds from
that bank’s balance (not bank balance). Credit card pays the money for anything
from the bank account like Debit Card but it’s a borrowing process. It means
that there is the inter-connection of a credit card with a bank account. All the
payment which are done through the credit card is fixed by the. In credit card, the balance of payment is deducted from the bank’s balance so we have to pay
that balance to the bank on a regular basis and certain terms & conditions.
The cardholder must have to pay the used amount either on a monthly basis. It’s
a type of short-time loan which must have to return with an additional amount. To
get such a card the bank collects all transactions and income sources and
provides the card on the basis of the income source.
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| what is credit card |
In a simple way, a Credit card
is just like a postpaid SIM Card service where the users have some limited access
to subscribe and use the service without depositing or paying the cash before
using any services. So, as like postpaid SIM service in Credit Card, the users
or account holder can use the money or make the payment without depositing any
balance or cash to the account. The main thing to be noticed in credit cards is
that we must have to maintain a balance.
Credit card features (features of Credit Card)
Like debit cards we can
also get some features of credit cards. So, let’s check out credit card
features and nature which clears what is credit card.
1. Postpaid Service
As like postpaid SIM Card, A credit card is also a postpaid service. Credit cardholders can use or make the
payment for services and purchase without depositing the balance in their account.
The thing is that, as like postpaid SIM service the users have to pay out the balance
to the bank in monthly basis. It is just like a loan service which we can use
it to make the payment.
2. Interest on Service
To pay the interest and
additional charge for the use of the credit service using a credit card the account
holder needs to pay a certain amount either in the form of service charge,
rules and interest. So, all the credit card holders after making the payment
using a credit card must have to pay out the certain additional charge to the
bank including the expensed amount.
credit card features
3. Bank’s Balance
If we are using the asset by
borrowing, crediting or lending from others then in the real sense that’s not our
property. Yes! As like this the balance or amount of credit card is not our own,
it’s bank’s balance, not our bank balance.
4. Fixed Credit Limit
In credit card, the cardholder has certain or limited access to expense the amount from the card in a
given period of time, maybe $500 per month. So, while finding out credit
card features it is also one of the notable things that we all must know.
Also Read:
debit vs credit card
We can find out the many differencebetween a credit card and debit card while making an analysis of credit
card vs debit card. So, let’s get started with some major differences
between debit and credit with analysis.
Points
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Debit Card
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Credit Card
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Balance Type
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Bank Balance
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Bank’s Balance
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Working Method
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From deposited balance.
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Crediting and borrowing.
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Use
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Free to use.
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Helpful in an emergency.
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Getting the rewards
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No
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Yes
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Interest
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No
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Yes
|
1.
Balance Type
The first difference
between a credit card and a debit card is the balanced type. Basically, a debit card
is such a type of payment card which is made by connecting the deposited amount in
the bank. A debit card is issued for those users who have deposited the balance
in the bank’s account. In this process, the card is auto connected to the deposited bank
account and balance will deduct automatically from the bank account.
A credit card is such a type
of payment card like a debit card where the cardholder can make a payment by borrowing
the balance from the bank. In such a type of card, the cardholder has to make sure
that s/he must accept and follow the strict rules and regulations of the bank. A credit card is issued for those users who want to make a payment if there is a lack
of own balance.
debit vs credit card
2.
Working Method
In the time of making the
payment debit cards draw the money directly or automatically from the card holder’s
checking account. Making a payment can be done by placing the desired amount to
the machine and the store's workers or merchants send the card information to
the bank then the desired amount gets transferred to the store's account or
merchants account. The card amount is deducted from the deposited amount.
Similarly, in a Credit card, any payment is done by borrowing the balance form the banks. It means that any transactions
that we are doing using a credit card is form the bank’s balance (the money of
bank that we are using by lending). In simple, a credit card allows you to borrow
money directly from the suggested bank with a limited amount. While talking about the difference between debit and credit card both the card has its own
working process.
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| difference between credit card and debit card |
3.
Use
In terms of use, there is
no limitation in the debit card until the deposited balance gets empty. It means
that the cardholders can use this card to make as much as many payments until
the deposited balance get zero. Debit card is our own money so in many cases, we
may use this for unlimited access.
In another hand, a Credit card
is that card that may be more useful in the time of emergency. In emergency
and urgent need of money credit cards will be the best option for everyone as
compared to the debit cards if there is no balance with us.
credit card vs debit card
4.
Getting the rewards
In terms of getting the rewards
and cashback, the debit card is quite backward. The transactions and payment done
using a debit card may not get the cashback and rewards. In credit cards, we can
see that the people are getting the cashback and rewards after making the
payment either on an online basis or offline. So, in terms of getting the rewards
(debit vs credit card) and cashback credit card is better and best as
compared to a debit card.
5.
Interest
Be sure that you are using
the right card as your requirements because both the cards have their merits and demerits.
So, if you are a debit card holder then you don’t need to pay the interest to
the bank for using the money. This is because we are using our own deposited
money in debit cards. But if you are a credit card holder then you may need to
pay the interest and additional amount for using the balance. So, in terms of additional
charges, a debit card is better than a credit card.
Also Read:
how does a debit card differ from a credit card | how is a credit card different from a debit card?
After finding out some
analysis for debit vs credit card many of us may still in
confusion. So, here we are going to throw out the best choice for you for how there
is the difference between a credit card and debit card.
1. On the basis of Usability
In terms of usability, we
can find a difference between a debit card and a credit card. A debit card is
basically used to make a normal payment of any purchase or transactions by the
people but a credit card is basically used for making the necessary, important
and emergency payments.
2. On the basis of Interest
Another difference between
debit and credit card is on the basis of the additional charges. If you are a
debit cardholder then there is no need to pay the interest to the bank for
using the money but in you are a credit card holder then you must have to pay
the additional amount to the bank in the form of interest.
3. On the basis of acceptance
On the basis of acceptance
of card, it is necessary to analyze debit vs credit card. So, on the basis of
acceptance of the card debit card seems to be ahead than a credit card. So, that’s
why how does a debit card differs from a credit card.
4. On the basis of additional features
Another reason that shows
out how is a credit card different from a debit card is on the basis of
additional services of the card. If we talk about debit cards then in debit cards,
we can get the features of interest-free, auto money deducting process from the
account, more acceptance, quick payment, etc. As a like debit card, credit card features
with borrowing money using payment, interest charging, limited payment, etc.
which is better credit card or debit card
Well after the long and
details discussion for the topic debit vs credit card from my personal
opinion credit card is better as compared to a debit card with the following
positive points of the credit cards.
1. No request for Loan
The most advantage of
using a credit card is that if you have a credit card, you do not have to beg
anyone to ask for a loan and money. Nowadays it's time to ask for money from
someone, it is not ours just because every person is just taking money but not
giving it to the public. So, if you have a credit card, then you don’t need to
ask for money and a loan from someone. That’s why credit is better than debit
card while analyzing credit card vs debit card.
2. Quick Money and payment
Making temporary money
for the payment is easier using credit cards because we don’t need to request
for the loan and borrow from others. The best thing is that if you have a
credit card, you don't have to spread your hand for money with anyone. So, it
is a quick method to get money and make a payment.
3. More rewards and Cashback
The main reason to prefer a credit
card is to get the cashback and rewards after making the payment. If you are a
credit card user then you may have got such an offer while paying the cash. You may
have noticed that credit card users are getting more rewards and cashback as
compared to debit cards. So, in terms of getting the rewards and cashback, a credit
card is top.
4. Most helpful indeed an emergency.
Most of the people who have a credit card have made this with the main objective i.e. emergency. Among the
various reason, the main reason to make and use a credit card is to get instant
money in necessary or emergency situations. So, in an emergency case credit card
will be the best financial friend for us. That’s why how is a credit card different
from a debit card and better than a debit card.
Are credit cards safer than debit cards
In terms of security, both
cards are equally secured. So, for the extra more security you may use
strong digits which makes difficult to hack and make the unknown use by the
attackers. Both cards including debit cards and credit cards are protected with extra
security layer so in terms of security there is no need to worry much. For the security
of the card, you must prefer the chip and
PIN card.
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