The two cards are the most commonly used ones by people of all ages to make payments. Both cards are used for purchases at stores or for online shopping. Not just that both cards look quite similar in terms of the identical 16-digit number, expiry dates, CVV Code, and EMV chips. But the usage of both cards is quite different.
Debit Cards: A debit card is issued by the bank on your savings or current account. The card is directly linked to your account. When customers use a debit card, they can spend money which is present in their account which means that the money will be deducted directly from their bank account. Debit cards generally do not levy a cash withdrawal benefit and they do have a daily limit on the usage in terms of withdrawal or spending. Payments are also done via debit cards from certain banks to enjoy cashback and rewards. For a debit card, a minimum balance is required to be stored in the bank. Debit cards linked to the salary accounts don’t require any sort of balance in them.
Credit Cards: Banks or non-Banks (NBFCs) generally issue credit cards. However, other entities can also issue these cards. Credit cards are nothing but cards where customers benefit from buying now and paying later. When payments are made by credit card, the bank gives you credit certain period and customers pay the bank for their purchase within the given due date. Banks give monthly credit limits, it depends on the kind of card you use and your credit-worthiness. You can make purchase goods and services at POS/e-commerce websites. Credit cards can help you maintain a good credit score if the bills are paid on time. While credit cards can also be used to withdraw money from an ATM, you must avoid it as it charges an upfront fee based on the amount which is withdrawn. You can also transfer money to bank accounts, debit cards, and other credit cards within the country which is subject to the terms and conditions.
