Debit Cards Have Become Very Popular

By: David Hall

Debit cards have become very popular since their inception. These cards are used like regularly credit cards at supermarkets, department stores, fast food restaurants, drug stores, gas stations and used to make various transactions at ATM machines. Debit cards also called "bank cards" or "cheque cards" are issued to customers without a credit check because the cards are issued against a depositary account. Therefore, purchase transactions can be made up to the amount of funds available in the debit card holder's account. Debit card holders can also apply for an overdraft protection which requires a credit check by the card issuer. This is an overdraft protection in case the debit card holder spends more funds than available in their checking account.

All debit card transactions are recorded on the cardholder's account which eliminates the need to save receipts as in the case of using cash to make purchases. Also using a debit card is a safer and convenient way to do business which eliminates the need to carry large sums of money. Once a purchase is made the funds is immediately deducted from the checking account. All transactions are listed on the cardholder's statement showing the date each individual transaction was done. Another advantage is that these debit cards carries the Visa and MasterCard logo.

Even though these cards are used primarily as a debit card they can also be used as a credit card at various businesses. Many banks awards airline miles for signature debit purchases but not for PIN debit transactions. Have you been to the supermarket and the cashier asks you if you want to use your card as a debit or credit. The right answer should be credit even though the words "debit" is written on the card. Using the debit card as a credit card will avoid paying PIN code fee not associated with a credit card.

One of the major advantages in using a debit card is that you are using your own money which gives the cardholder an awareness of frugality. With a regular credit card it is very easy to rack up large balances and high interest rate that only gets the credit card holder deeper and deeper in debt. There is no interest expense associated with debit cards because you are using your own money to make purchases. The only time the debit card holder will pay interest expense is when they have accessed their overdraft protection credit line.

Debit card holders are starting to receive rewards programs, zero liability fraud protection but not as robust as credit cards that normally receive cash back, rewards, bonus miles etc., whenever they use their card to make purchase. It might be preferable for individuals who pay their bills on time to use a credit card instead of a debit card to get the maximum benefits mentioned. Some businesses do not accept debit card to make purchases such as car rental companies. The main reason is that many debit cards do not offer insurance protection plan that is customarily available with credit cards.

It is advisable to use a regular credit card whenever making large purchases. Credit card cardholder is protected from fraudulent purchases. This gives the right to return defective merchandise and the right to withhold payment to the seller if the cardholder is unsatisfied with the quality or condition of the item purchased. Credit card holders who lose their card are protected from fraudulent purchases once reported to the card issuer on a timely basis unlike many debit card holders who is at the mercy of the card issuer. Keep in mind that many banks offers protection for individual checking account against fraudulent purchases which is a protection to the debit card holder in a roundabout way. Some debit cards that carries the MasterCard and visa logo do have certain rights and protection and it is important to know what they are.

Many people with low credit score also apply for debit cards because they are easy to get and no savings account is required. It is often said that these cards can rebuild you credit over time since many banks reports transaction history to the credit bureaus.

About The Author

David Hall's website www.creditcardsessential.com offers comprehensive search and comparison tools to help you find the best debit card that meet your needs. Once you've decided on a particular card, our simple credit card application system will help you get on the way to instant approval. This article is free to publish in its entirety and must include all links: http://www.creditcardsessential.com

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