what is the different between a credit card and a debit card?

6 Answers

  • Scott
    Lv 7
    9 months ago

    A credit card is a way of extending credit. You can spend up to the credit limit and pay it back in installments. A debit card is no different than having a checkbook. You can only spend what's in your checking account. No money in your account? Then your debit card is useless.

  • 9 months ago

    A debit card is simply attached to your bank account and has access to the cash there.

    A credit card is attached to a line of credit that is revolving. Meaning you can charge it up and pay it down over and over.

  • A.J.
    Lv 7
    9 months ago

    With a credit card, you buy with credit, use the bank's money to buy things. At the end of the billing cycle is the CLOSE DATE and balance is due. You can generally pay the full close date balance before the due date in full and not pay interest. The merchants are paying for this service. If you pay at least the minimum but less than the statement balance, interest starts accruing by the average balance and interest charges continue until fully paid off. Accounts in good standing raise your credit score. Good cards have extra features such as rebates and rental car insurance.

    A debit card very quickly takes the money from your attached savings or checking account. It is not tracked as credit and has no effect on credit rating. It is almost liek an ATM as the limit is the money you have.

    A credit card, by law, is protected against fraud. You cannot lose more than $50, and that is usually waived if you report loss or theft quickly. With a debit card, loss is the banks policies and in theory you can lose all the money in the account. Most banks do protect against fraud in some ways on a debit card.

    A credit card is better for security deposit in renting a hotel room or car.

    Since it is the bank's money, it only puts a hold on some of the credit limit.

    With a debit card, they take the money and give it back later. You actually need the money in the account and it could freeze for a week.

    I NEVER use a debit card. I use credit cards for most purchases and cash for small purchases.

  • 9 months ago

    debt is money you have in the bank credit you dont have the money and get it w/credit

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  • Rick B
    Lv 7
    9 months ago

    A debit card withdraws the spending directly from your account at the time of purchase. A credit card allow you to make payments and charges HUGE interest rates on purchases if you do not pay them off in full when the bill arrives.

  • 9 months ago

    A debit card isn't as secure as a credit card.

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