Debit cards are becoming very popular. A debit card is often tied in with a major credit card so they can be used like a credit card, however, unlike a credit card a person can only spend the amount of money they actually have. A debit card is tied into a persons checking account.
Basically the idea of debit cards is to reduce the need to write checks. With everything quickly becoming paperless this fits right in. Debit cards are also the persons ATM card. They can use them just like any other debit card. Unlike a credit card, though, as long as they use it at their banks ATM they will not receive additional charges for a cash advance because they are actually taking their own money out of the bank.
Distinguishing between a credit card and debit card is done in a few different ways. First of all, while the credit card logo is on the debit card, there is also usually the banks logo and the word ‘debit’. However, a credit card and debit card do look familiar and usually only the person using the card knows it is a debit card not a credit card.
The main difference is the way the card works and where the money comes from. Debit cards can be used as either a debit card or credit card. Credit cards can only be used as a credit card. Debit cards do not carry a line of credit. The purchases made with a debit card can not exceed the amount of money a person has in their bank account. This is the main difference between a credit and debit card.
Another major difference between credit and debit cards is the risk involved. Because they are attached to a bank account, loosing a debit card is very risky. A person does not need a pin number to use a debit card and therefore can easily drain a persons bank account, causing extreme problems.
With a credit card the only problem is proving that someone else used the card. With a debit card the persons has to figure out how to get their money back and if any checks bounced they are responsible for those as well. The legal liability is much greater with a debit card than with a credit card.
The good thing about a debit card, though, is that it gives a person the freedom to use it anywhere credit cards are accepted. They liminate the hassle of having to write a check and show id. They are easy to use and accepted in a large variety of places.
Debit cards are convenient and easy to use verses checks or an ATM. They do have some risks, though. That makes it important for a person to use their debit card carefully and make sure they keep it in a safe place.
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