Also termed as “plastic money”, debit cards and credit cards are financial instruments that have become a complete alternative to cash. With the ever-increasing benefits of cashbacks, reward points, safe transactions, and easy handling, these financial tools have now become the most preferred way of handling money. Show
While both these instruments seem to be more or less similar, the fact is that they are not. Let us first understand what is a debit card and what is a credit card, and then we will look at the major similarities and difference between credit card and debit card. What is a Debit Card?A Debit card is issued by a bank against your current account or savings account. The major point to be noted about a debit card is that it allows you to use only the amount of money that’s available in your bank account at the moment. This implies that as you make payment using your debit card, the amount of purchase will directly be debited from your current or savings account. What is a Credit Card?A Credit card is a financial tool that allows you to borrow funds from your credit card issuer at the luxury of making purchases as and when required. Additionally, to repay the borrowed amount, you get a grace period of around 45 days without any interest charges on the billed amount. When you buy a credit card, you get a customized credit limit, which indicates the maximum amount that you can spend using your credit card. A credit card also Apply For Credit Card Read More: How to Activate a Debit Card- Few Easy Steps to Follow Similarities in a Debit Card and Credit CardA lot of people mistake credit cards for debit cards and vice versa. Well, both these types of card actually have a lot of similarities between them. Let’s look at a few of these factors that justify this confusion-
Difference Between Debit Card and Credit CardWhile both, the debit and credit cards look identical, there may be a lot of features that make them absolutely different. It is advised that you have at least one of each of these cards to fund any urgent expenses that you may have to make and to balance your finances with ease. To do so, it is important to understand how a debit card and a credit card are different from each other.  Apply For Credit Card FAQs What is the difference between debit card and credit card? Debit cards and credit cards have a lot of differences in terms of the source of funds, hidden expenses, additional benefits, spending limits, eligibility criteria, etc. For instance, when you use a debit card, the amount that you spend is deducted from your current/savings account, whereas when you use a credit card, the amount that you spend is deducted from the credit limit allotted to you. Additionally, there are no hidden expenses in a debit card, while there are a few in credit cards. Are debit cards and credit cards the same? No, debit cards and credit cards are not the same. Even though there may be a few similarities between the two, there are still a lot of major differences between them. Which is better- debit card or credit card? Both these types of cards have their own advantages and disadvantages. You should choose to buy either or both of these cards depending upon your needs, income, and credit capability. Is it safe to use a debit card? Yes, it is absolutely safe to use a debit card. However, it must be noted that debit cards provide minimal safety in case of loss or theft of the card, which is not the case with a credit card. Do debit cards and credit cards have similar features? Yes, debit cards and credit cards have a lot of similar features. These features include similar appearance, use of a PIN to make any transactions, etc. Are there any additional expenses on a debit card? No, there are no additional or hidden expenses associated with a debit card. Is there any limit on the amount that I can withdraw using a debit card? The maximum amount that you can withdraw per day from a debit card varies from bank to bank. The usual daily limit for withdrawals from a debit card is Rs. 20,000. Can I withdraw cash using a credit card? Yes, you can withdraw cash using a credit card. However, you must note that cash withdrawals using a credit card charge additional fees. What is an ATM card? An ATM card is any card that can be used to withdraw money from an ATM. ATM cards are basically used to withdraw cash, check account balance, or transfer funds from one account to another. These cards serve only specific purposes, unlike credit cards that are multi-functional. What is the difference between credit card and debit card class 9?The major difference is that with a credit card, the bank lends you money to use which you can use and pay them back with interest on a monthly basis. Whereas, with the debit card, you are spending the money which you already have.
What is the difference between credit and debit with examples?The debit card will withdraw the amount of your purchase from your checking account in real time. However, the credit card will withdraw the amount which will then be charged to your line of credit. This means that bill payments will be made at a later date, giving you more time to pay them.
What are similarities and differences between debit and credit cards?A debit card is linked to your bank account. It's usually your money that you're spending or withdrawing, unless you have an overdraft, which is a type of credit linked to your account. A credit card is a standalone account giving you access to a pre-agreed credit limit.
What is the difference between debit vs credit cards and advantages and disadvantages of each?Both can make it easy and convenient to make purchases in stores or online, with one key difference. Debit cards allow you to spend money by drawing on funds you have deposited at the bank. Credit cards allow you to borrow money from the card issuer up to a certain limit to purchase items or withdraw cash.
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Distinguish between credit card and debit card
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