Both credit card and debit card are usually similar to each other to look at it superficially, which have 16 digit numbers on it, with EMV chips and magnetic strips, they both assist in making purchases, online or in stores easy and super convenient to the cardholders.
The only striking difference between these two cards is, a debit card allows the cardholder to pay using the withdrawal of money deposited in one’s account, whereas the credit card allows the user to borrow money from the bank at any time up to a certain limit and make the purchase, which they’ll have to pay back within some stipulated period.
Their uses and benefits vary from each other despite having the same external features, they have some drawbacks too, which can affect our financial steadiness, So one must learn the pros and cons of these cards and be wise in selecting which cards to use, before making any payment.
Table of Contents
1) What is a debit card?
A debit card may be similar to a credit card when looked at superficially, but it has its distinctive features which are way more different and contrasting to that of the credit card.
It’s linked to the user’s bank account, that can be used wherever the credit card is permitted. If the debit card of yours carries the logo of the visa, it simply denotes that you can use the debit card in the places where the visa can take you to. Once you purchase a debit card, the amount of money spent gets immediately withdrawn from your account or otherwise will be held by your bank for 24 hours.

The withdrawal of money from your account using a debit card requires you to give your unique personal identification number(PIN). For people who don’t want to overextend their credit limit and then suffer financially, the debit card is the best option when compared to a credit card.
An Automated teller machine card is more similar to that of a debit card, as they both allow you to withdraw money from your bank account. But using a debit card, you can straight away make payments for your purchases of goods and services which is way easier than using an ATM card which only assists you in the withdrawal of funds. However, the visa or MasterCard logo can be only seen on a debit card, thereby allowing you to even make purchases abroad
2) What is a credit card?
A credit card is a debt tool or instrument that allows you to make an instant payment, which involves financial transactions without cash or cheque or even a debit card. The most important thing to understand is whenever we make a purchase using a credit card, the money borrowed gets added to our outstanding balance, which needs to pay back within a stipulated period, if not the bank would start charging interests to the outstanding balance which is more than the money we lend.
These interest rates by bank companies can be enormously high, which may even at times lead us to regret using the credit card. Hence, timely payment of the debt every month is all it requires to manage a credit card. ‘
To know more about credit cards: What are credit cards? Top advantages of using credit cards.
3) What are the main differences between credit cards and debit cards?
here the bank company makes the payment for you. A credit card allows you to make purchases first and pay for the bill later to the bank, But with a debit card, the money gets instantly taken out from your checking account to pay for the purchases. It’s to be noted that, if your bank balance is empty you probably can’t use a debit card as the transactions are made directly, but Credit cards help you make a payment even without any bank balance, which you’ll have to pay later along with the interest, this can either build up or hurt the credits.
A debit card is just a replacement in the place of using cash or a cheque, nothing more nothing less, but when using a credit card, it’s more like you are getting money for interest which you need to watch out for; To simply put it into words, debit card involves your own money, credit involves a borrowed money.

There is no theory stating that one card is better than the other, it all depends on how you manage your money and account. However if your debit card gets missed or if someone steals it, you’ll have to face more difficulty in reviving your money back than losing a credit card, which will only require you to report about your stolen card, so that your liability gets limited after which your stolen card can’t make any further purchases.
4) What are the benefits of credit cards over debit cards?
“A credit card allows only you to go through the debt funds” This was the most heard opinion about credit cards. It has several advantages over debit cards. They are
4.1) Using other’s money
In the business field, you can survive over a long time without making a profit, but you can’t survive without cash even for a single day. Cash is always ultimate in the business field. Many companies run out of business due to insufficient funds.
In this situation, you can use your credit cards to make your payment. You can pay any kind of bill by borrowing the credit card company’s money. In this way, you are using the other’s money. Here you can’t use your debit card if you run out of cash in your account.
Many entrepreneurs use this kind of payment in the initial stage and manage to earn profit through a disciplined business. Successful entrepreneurs will pay their credit bills every month. This allows them to free themselves from credit card debt and manage a high credit score.
It is a smart tool for using credit card company’s money. Getting a loan from the bank and repaying it to the bank is a time-consuming process and you need to pay the interest amount for the capital amount.
4.2) Feature of borrowing money for free using credit card
You are borrowing money for free from a credit card company every time you swipe. Most people are afraid of paying the credit bill every month. They think that they wouldn’t pay these bills and it would get them into credit card debts.
As said earlier it all depends upon your discipline of spending money. Use the credit card wisely. For example, f you are on a long drive you haven’t any cash in your hand and even your balance on your debit card is too low to make payment at the toll gate. It is the place where you can swipe your credit card.
After the payment is done you should provide time to repay this bill. Use that time to generate income to repay your bills. Don’t be afraid of credit card debts. A debit card won’t allow you to borrow money for free from credit card companies or banking institutions.
4.3) Tool to build up your credit score
A maximum number of people don’t think or overlook their credit score. A credit score significantly shows your credibility. It increases your borrowing power. This habit of maintaining a credit score should be developed right from a young age.
For example, if you are going to get a housing loan or car loan, the first thing the banking institution does is look at your credit score. The higher the credit score the higher will be the chance of getting loans. Whatever may be the reason if you are a businessman willing to raise the capital, or buying the car using the loan banks will judge your lifestyle using your credit score.

A debit card never allows you to build up your credit score. As said earlier your credit score will be high depending on how fast you repay your credit bills.
4.4) Earning reward points
The main reason why you should use credit cards is you are getting rewarded whenever you swipe your credit card. This feature makes credit card usage more interesting than debit cards.
The rewards can be different types based on the different credit card companies.
Some companies offer cashback for using a credit card. Mostly the cashback will be 1% of the total amount spent. It will be directly credited to your account. Some companies offer travel rewards where you can earn a mile. Mile represents the distance you travel on the airlines. You can redeem the miles reward while booking your air ticket.
Other types of rewards include coupons and vouchers. You can use this coupon and voucher to avail yourself of the discount while you are shopping. Nowadays these rewards can also be used for online shopping as well.
Each banking institution and credit card company has been in partnership with shopping vendors and airlines etc… This earning of rewards doesn’t include debit cards. Credit card companies are paying you the reward to encourage the use of credit cards.
Travel cards provide several premium features. For example, if you are using AMEX cards you can enjoy free access to airport features across the world. A debit card doesn’t offer these kinds of features.
To know more about: How to redeem and earn credit card rewards?
4.5) For Better protection
If your credit card has been stolen or lost. If someone uses your credit card without your knowledge, a fraudulent department from the credit card company would inform you that someone is using your credit card. They should block your old card and issue you with a new one.
If any money has been used they will provide it to you. This makes credit cards the safest ones to use. Even some credit cards also provide insurance protection.
If your debit card is stolen, and assume that he knows the PIN of your card. If he withdraws the amount from the card, then no one else could save your money. The bank doesn’t repay your money.
In the case of credit cards, you may submit your proof that the transaction has happened without your concern. If it has been proved the credit card company will repay the amount to you.
4.6) Universal acceptance of credit cards
If you own a credit card you can use it wherever you want. You can use it all over the nations around the world. For example, the credit card that has been brought in India can also be used in America and Russia too.
But you can use a debit card all over the world. They have their own limitations. However, some of the intentional debit cards can be used wherever you want. But not all the cards. Thus credit card has a universal acceptance.
These are the unique features and the benefits of credit cards suggesting that credit cards will be a better option than debit cards.

Hereby we conclude that these are the pros and cons of debit and credit cards. Whether it is a debit or a credit card, choose according to your need. Both have unique features individually. However, credit cards are not easily accessible to all types of people but on the other hand debit cards are easily accessible to all. If you use a debit card keep an eye on the account balance. If you are using a credit card keep an eye on the credit bill due.
5) FAQ
In case you are a frequent traveler, having a premium credit card that offers free airport lounge access. You’ll get relaxed access with these cards as well in the general depository of movement benefits.
Premium Mastercard’s offer liberal sign-up rewards, travel buy credits, free web access, the capacity to procure travel rewards, extravagance advantages, and advantages, help when things turn out badly, and travel and buy assurances.
Secured credit cards will probably be the simplest cards to get for those with either helpless credit or no credit. That is because they require a guarantee forthright as a security store, which is commonly equivalent to the measure of your credit line and lessens the danger to the card backer if you neglect to take care of your bill.