There is so many difference when it comes to debit card and credit card. Debit means deduct, when a person uses his debit card and withdraws the money, then money will be deducted from the bank account that which is linked to the debit card. The user can only use the amount that which is present in his bank account and can’t take more than that. A debit card acts like a cheque, that the amount of money uses to deduct from their personal bank account. But when it comes to a credit card, credit means a loan, when a user uses his credit card and withdraw money, then the amount of money is given by bank as credit. A user can spend as much as from credit card and that amount should be paid to a bank within a particular period of time. Let’s have a detail information regarding debit card and credit card;
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The bank offers a debit card to its customers to withdraw and to purchase goods and services by spending money from their banks saving account. So, when the user does any transaction with debit card then the amount will be reduced from the user’s bank account. In the case of a debit card, the bank used to charge a nominal amount for every month for the usage of the debit card. Debit card can be used for withdrawal of money, transfer of funds, deposits, purchase of goods and services and internet banking etc. Nowadays, a debit card is mostly used by everyone and even allow users to have all the facilities of a debit card or ATM card.
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The banks provide the credit card facility to their users to a withdrawal of money, purchase goods and services, but payment will be paid by the third party (bank) on behalf. The user should pay credit amount to a bank that which spend through his credit card. The bank used to spend money on the behalf of the customer and will collect the credit amount with the credit period. The maximum credit period that every user is allowed is 30 days, if the user couldn’t pay the amount with the credit period then the bank will charge the interest as per their perceived rate.
Both the debit card and credit card are made up of plastic with a magnetic strip is attached to it that which contains all the general bank account details of the customer.
Main Differences Between Credit Card and Debit Card:
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- In the case of issuing a debit card the user should have a bank account, but for a credit card, the user no need to have a bank account
- One of the major difference between debit and credit card is, the amount withdrawn from a debit card is deducted from a bank account which is linked to the debit card, in case of credit card the amount will not be deducted from the bank account.
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- No interest is charged for a debit card, but in case of credit card interest will be charged by the bank.
- Debit card withdrawal limit depends upon the balance in the bank account, but in the case of a credit card, the maximum withdrawal limit depends upon the credit rating of the user.
These are the few major differences between the debit card and credit card that everyone should know about them.