Difference between Credit Card & Debit Card


A debit card is a payment card that deducts money directly from a consumer’s checking account when it is used.  It is issued by a bank to their customers to access funds without having to write a paper check or make a cash withdrawal.

Debit Cards are directly linked to the owner’s bank account (such as a salary or savings account). When the Debit Card is used, the amount is deducted directly from the bank account.


A credit card is a transactional card that enables the holder to make purchases of goods and services or withdraw advance cash on credit. The credit card allows the holder to borrow money against a line of credit, also known as credit limit of the card.


The following are the main points of difference between credit card and a debit card.

About Credit cards are lines of credit. When you use a credit card, the issuer puts money toward the transaction. This is a loan you are expected to pay back in full (usually within 30 days), unless you want to be charged interest. In case of debit card, the amount is directly deducted from the bank account when the purchases are made.
Spending limit Can spend more than what you have. Can only spend how much you have in your bank account.
Bill or statement You receive a bill or statement at the end of the month with the details of the transactions made. No bill or statement is received.
Withdrawal fees and interest Withdrawal fee and interest is charged on credit cards. No withdrawal fees is charged in case of debit card.
Security Credit cards are more secure in case of fraudulent activity as they come with protection against fraud. Debit cards do not offer much security in case of fraudulent activities.
Connected with Credit cards are not required to be connected to a checking account. Debit card is connected with either savings or a checking account.
Source of Funds The credit is extended by the card issuer company. Therefore, the credit card company pays the vendor for your purchase. Savings bank account or current account


Thus, in a nutshell, Both Debit cards and credit cards have their own benefits and are useful tools when you are paying for goods and services.

If you have spending issues, it is better to use your debit card whenever possible, to prevent yourself from falling into credit card debt. Whereas, Credit cards are a better option if you want to build your credit history and they also offer huge financial benefits to the cardholder.

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