In order to better manage your money, it is certainly necessary to have both cards, but understanding the difference between a credit card and a debit card is important to use the correct one at the right time.
All of you will have happened to arrive in front of the checkout counters of a supermarket or shop and be asked the question: ATM or credit card?
Both allow you to pay for your purchases via POS and electronic payment systems, but to choose with awareness which of the two to use, you need to know the differences.
We know that the difference between a credit card and a debit card (more commonly called ATM) basically concerns the way in which money is managed, but to understand it better, let’s see how a credit card and a debit card are defined.
Credit card: what it is and what are the advantages
The credit card, also called electronic money, is a payment tool that allows you to deposit money without using cash. One of the advantages of a credit card is the ability to use the money right away that will be charged to us later. The charge to be paid by the consumer to his bank account takes place only in the middle of the following month in which the payment was made. In some cases, it is even paid in installments.
The items that we find on the credit card concern the personal details of the holder, the card number, and its expiry date. Furthermore, the credit card holder is required to put his / her signature on the card, in the space provided for this purpose.
The debit card, on the other hand, is commonly called an “ATM” even if in reality the word “ATM” simply identifies a national payment circuit (such as the VPay or Maestro circuit).
So what is the difference between a credit card and a debit card?
With the debit card, when you make a payment, the amount is debited from your current account immediately, without the possibility of paying in installments. Precisely for this reason, when using a debit card, particular attention must be paid to the issue of security.
In fact, all debit cards have a protection system that provides for the confirmation of payment via a PIN code for each transaction of a PIN code. The security code is provided directly by the reference bank, usually via SMS.
With the debit card in addition to direct payment in any business, you can withdraw or pay cash or by check, consult the statement of your current account, pay bills, top up mobile phones or prepaid cards, and make payments online. Although many consumers think that online payments are less secure than cash payments, in reality the credit card offers a number of guarantees more than cash, starting from the blocking of the card in case of theft, up to the free anti-fraud service. which allows you to keep your purchases under control by informing the consumer via text message every time a payment is made in excess of a previously agreed amount.
Difference between credit card and debit card
After briefly explaining what a credit card is and what a debit card is, let’s see what the main differences are.
There is only one substantial difference and it lies in how the money is managed.
In fact, with a credit card, you can make purchases even when the money is not immediately available in your current account, with a monthly spending limit generally high enough that cannot be exceeded and which varies according to the contract stipulated with your bank.
With the debit card, on the other hand, you can withdraw and pay directly in cash or make the payment directly via a mandatory POS or via virtual payment systems, but with a usually lower monthly spending limit, since in this case the money is withdrawn. from the bank account.
So what if we are in front of the supermarket checkout and we don’t know whether to use a credit or debit card to pay for the shopping?
It depends on the amount of the amount: since the debit card has a higher spending limit and is usually used to withdraw the money we need to have some cash in the wallet, it would be better not to use it for payments. electronic with high sums.
Therefore, between the two, it is always better to pay by credit card!