Debit Card vs Credit Card: What is the difference between a Debit Card and a Credit Card? Which card is better for you? Know everything..

Debit Cards and Credit Cards play an important role in online banking or digital transactions. Both these cards are used to do financial transactions, but still, both are different from each other. Therefore, it is also important for you to understand the difference between the two cards (Debit Card vs Credit Card). You should know how and for what things you can use a debit card and similarly, where you can use a credit card. Today we will tell you this. But first, let us know what a debit card and a credit card are.

What is a Debit Card?

A debit card is also called plastic cash. This card is issued by banks. You can use it for everyday shopping. It allows you to withdraw cash from ATMs and do other online and offline transactions. A debit card can be used at an ATM to withdraw money from a bank's savings account or current account. You can withdraw cash from your bank account or deposit money in it using this card.

What is a Credit Card?

A credit card is a financial tool that allows you to make purchases first and pay for them later. A credit card comes with a preset credit limit, which is the maximum amount you can spend. In simple terms, every time you use your credit card, you borrow money from the bank or the financial institution that issued the card. That is, it is a kind of loan.

Difference between a debit card and a credit card

Whenever you make a transaction using a debit card, that amount is deducted from your savings or current account. Whereas the amount used through a credit card is taken as a loan from the bank.

Through a debit card, you can use only the amount that is present in your bank account. Whereas you can use your credit card within the given credit limit.

If you want to get a debit card from a bank, then for this you must have a salary, savings, or current account in that bank. Whereas to get a credit card from any bank, it is not necessary for you to have an account in that bank.

Using a debit card gives limited rewards and cashback benefits. On the other hand, credit cards offer the benefit of more reward points and cashback.

The facility of EMI in debit cards depends on the agreement between the seller and the bank. On the other hand, an EMI facility is usually available on transactions of more than Rs 2,500 on credit cards.

The use of a debit card does not affect your credit score or CIBIL score. On the other hand, the use of credit cards directly affects your credit score.

ATM/Debit cards offer higher cash withdrawal limits. While credit cards offer additional benefits, such as Airport Lounge Access.

An annual maintenance fee of around Rs 100 to Rs 500 has to be paid for a debit card. While for a credit card, an annual membership charge of more than Rs 500 may have to be paid.