8 Things You Need to Know About Debit Cards

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  1. Debit cards keep you from going into debt.  

 If you try to use your debit card when there’s not enough money in your account to cover the transaction and your account doesn’t allow overdrawing, the transaction will be declined. No fee is charged. If your account allows overdrawing, you can be charged a fee, like with a cheque account. 

  1. Debit cards can function in two ways

Like an ATM card for immediate withdrawals of money. And used for making purchases. The money used to pay for the transaction is usually deducted from your account within a day or two depending on when the retailer presents the transaction for payment. 

  1. Debit cards are the equivalent of carrying around your money with you.

Whereas with the debit card unlike lugging around loads of money in your wallet your money is presented as a nifty plastic card that you can use to swipe for payments.  

  1. Transactions are immediate

Unlike credit and charge cards, payments using a debit card are immediately transferred from the cardholder’s designated bank account, instead of them paying the money back at a later date.  

  1. There can be low to no interest

A debit card, which accesses your own funds and you don’t accrue a balance on which you need to pay interest. 

  1. Debit card use doesn’t appear anywhere on your credit report

Therefore it doesn’t affect your credit score, or require credit checks during application as a requirement maybe that you need a bank account. 

  1. You can’t be rewarded for the use of a debit card

This is because the standard debit card offers very small or zero rewards. 

  1. The types of debit card include

A savings account suitable for someone who starting to have a bank account or someone who doesn’t earn all that much. Or a cheque account suitable if you can afford the fees associated with this type of debit card.

 

 

 

 

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