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Debit Card
Published on Friday, May 25, 2018
By Admin
Credit card and debit card both are small plastic cards issued by the bank. With the help
of debit card, an account holder is able to access money anytime and anywhere
whereas credit is used to make payment on a credit purchase.
Debit card
o Debit card means to deduct the money as the name itself describes the meaning
of it.
o A debit card is a type of service provided by the banks to its clients to obtain
goods and services from his saving bank account.
o In a debit card, money is deducted when an account holder makes use of it which
is linked to the account holder's bank account number.
o An account holder is able to spend the money which is on his account, not more
than that and when there is no money in an account, a debit card will be declined.
o A debit card is the same instrument like a cheque it means when an account
holder uses it an amount automatically deducted.
o Bank charges fees on a monthly basis from the customers.
o A debit card is used to purchase goods, to transfer fund, e-banking, M- banking,
to deposit fund and much more.
Credit Card
o A credit card is a type of service provided by the bank to its customers to make
payment for the purchase of goods and services on credit.
o Credit card means money taken on a loan from the bank which must be repaid on
time with the interest applied.
o In credit card, a payment is done by the bank as a third party to the seller on
time.
o A credit card is given to an account holder based on the parameters like credit
history, repayment capacity, income statement and debt.
o Fees are charged for the services and it is a monthly base.
o In credit card, banks usually allow a credit period of 30 days to repay a credit
amount.
Credit history:
o For issuing a debit card, a bank doesn’t need a history of an account holder and it
doesn’t affect at all.
o For issuing a credit card, a bank needs credit history of an account holder and
this is the most important parameter for issuing it.