What is the difference between credit and debit card?

Both the credit card and the debit card are plastic, have our name printed and can be paid with both. The differences refer to the type of financial product they support, that is, debit or credit .

The cards, in exterior appearance, are quite similar to each other. The difference between credit and debit cards is due to the payment method, the possibility of financing and the interest that both can generate . Knowing these disparities between both types of financial products can be key when choosing between them.

1. According to the payment method . On a debit card, the payment is charged directly to the account of the holder . Thus, they only allow the collection up to the limit of the funds of the account. On the other hand, with the credit card you can pay even if there are no funds, since there is the option of postponing the collection until the following month. In this way, the owner contracts a debt with the bank . Even so, the credit card has a limit that can be refunded: at the end of the month (an established day of the month following the purchase), or by means of a percentage (which we will disburse every month) or a fixed fee ( paying a set fixed figure).

2. Depending on the possibility of financing . Credit cards allow financing . Thus, they allow payment in installments and make purchases without having to pay the total payment. That is, it implies the granting of a credit by the bank. In contrast, debit cards are a means of payment in itself: the amount is charged directly to the account of the cardholder , and is deducted directly from the balance.

3. According to interests . The credit card charges interest to the owner , when withdrawing money or when splitting payments. These interests are not frequent in debit cards.