What's the difference between credit & debit card?

Is a credit card money that the bank gives you to spend but then have to pay back. and is a debit card one where you put in your own money in the bank :s|||A debit card takes money from a pre-established bank account. If you do not have the money in it, you can not use it. A credit card lets you "borrow" money for the time being, with the intentions that you pay for it at the end of the month. Credit cads usually add on an 'interest fee' for their services, so you end up paying more then the actual item is worth.|||Basically yes. But I don't like how you worded the credit part. Credit isn't actually money that a bank gives you. It's an amount that is available to you if you need it. And if you use it, then yes, you have to pay it back.





And the debit card doesn't put your money into a bank account. You deposit it yourself or you have your employer set up a direct deposit and then you use a debit card to pay for purchases.|||Yes, basically. However, credit cards have interest that they charge you for whatever you owe. Say you owe 100$, and the interest is 5%. When it comes time to pay the bill, you now owe 105$. If you miss a payment, they kill your rate and it can go up to 21% (I think that's the max) Debit cards, however, are linked to your checking account in the bank. However much money you have in there is how much you can spend on your card. Both have overdraft fees if you spend more than there is available.|||A credit card is a simple loan. You are "pre-qualified" to borrow money up to the limit on your account. When you make a purchase, the bank advances you the money which is paid to the merchant. Your account then has a negative balance. Anywhere up to 25 days later, the bank sends you a statement showing what you owe. If you pay in full on or before the due date, you are not charged any interest. If you elect to pay in installments, then you are charged interest. There may be an annual fee. If you pay in full, what the bank has done is make you an interest free loan for anywhere from 20 to 55 days. During that time, your money stays in your savings account earning interest for YOU until you take it out to pay the bill. There may be a fee or penalty applied if you go over the account limit. Or, the bank may simply refuse the transaction if it would put you over the limit. I use my credit card for most everything and I pay in full when due, thus avoiding any interest paid to the bank. However, my money has spent time in savings waiting until the bill is due, earning interest for ME.





A debit card works differently than a credit card. A debit account is very much like a checking account only you use a card instead of writing a check. You put money into your account. Most likely, there is an annual fee for the account. So, instead of them paying YOU interest as they do on savings, YOU pay THEM to hold your money! When you make a purchase, the merchant gets paid from your account. Sometimes there is a fee per transaction as well as an annual fee. The merchant does not see anything different at his end of the transaction except for a signature if you use a credit card or you enter your account PIN for a debit card. Either way, he gets paid by the bank for the purchase you made. What is different is everything else from the bank side. There are huge penalties and fees if you overdraw the account and this is where the banks really rake in the dough. The reason is that they do not tell you or refuse the transaction if there is not enough money in your account. Say you use your card and overdraw by $1. Then later that day, you charge another dollar, and finally a 3rd dollar. For going over by $3, you were charged $35 for EACH transaction as a penalty, making your $3 purchases cost you $3 plus $105 in penalty fees! Since there are generally 25 days in the billing cycle, you may be overdrawn a LOT by the time you get your next statement. I recently read a news story about a woman in New York who ended up with $6000 in penalties for about $300 in purchases! She had gone for 3 weeks overdrawn and used her card for everything. THAT is what can happen if you do not pay attention. Recently legislation was passed that forces the bank to allow you to "opt-out" of overdraft protection, which means they now will refuse a transaction IF you tell them in advance that you do not want overdraft protection. The key here is YOU must TELL them. The default is to provide the overdraft protection.





The debit card is THE biggest cash cow the banks have ever devised. Opposite to a savings account where they pay YOU to hold your money for you, with a debit card You pay THEM to hold your money for you! Where is the logic in THAT? All you are doing is paying THEM for the convenience of using a CARD to get at your own money! Why not simply just visit the bank in advance and take some of your cash out of your savings? Is the convenience of having a card to use THAT important to you that you can't go with cash and carry?|||Yup, exactly.





However, to complicate matters, debit cards can be used in credit mode, where you sign instead of using a PIN. But it is still a debit card even though they call it credit.|||A credit card is like the bank paying it for you, but you have to pay them back with interest.


A debit card takes money from your checking account and once that money runs out, you're out of luck.|||A credit card is one You use now and pay it back later.


A debit card is one where you already have the money in your account and have to spend right then.|||A credit card will bend you over and take your pants down





A debit card just uses the money you have





If you have an option just use a debit card.|||You have it exactly right!|||credit isn't ur money and u pay it back with interest


Debit is you money in your own bank account