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What is a debit card and how is it different from other cards?

June 8, 2022
woman paying at a shop

Let’s dive in and see which one is right for you. We’ll check out how each works and how they compare to each other.

What’s a debit card❓

A debit card is a type of payment card that connects to your bank account. These cards also connect to major card providers, such as Visa and Mastercard.

So maybe you're wondering, what is Visa debit? Or What is Mastercard debit? Those companies help process your transactions for your bank when you use your debit card.

Since the card connects to your bank account, you need to make sure you have enough money to cover purchases. If you don't, your card will probably decline the transaction. 

How to get it🙌

You'll need to open an account at a bank that gives out debit cards. Then, you'll receive a bank card in the mail after the bank processes your order and creates the card.

If you already have an account, you can ask your bank to send you a debit card. Depending on your bank, you may need to visit the bank in person.

However, there are plenty of online banks that allow you to request a card online. bunq users only need the app to order a debit card, so it takes zero effort. Moreover, (at least) one is included for free with all our plans, besides Easy Savings. 

Where you use it💳

You can use a debit card when making purchases online or in person. The card works in most credit card terminals at shops, so you can swipe your card or insert the chip into the card reader.

When shopping online, you’ll simply enter the card number, expiration date, and CCV. That way, the online payment processor will be able to handle the transaction as if you were in person.

After the store processes your transaction, it will deduct that amount from your bank account. You can continue to use the debit card for anything you need to buy, and you may need to create and use a PIN to protect your transaction.

What is a credit card❓

A credit card works similarly to a debit card, such as the fact that the card comes from a company like Visa. And you may wonder, is Mastercard debit or credit?

Both types of cards can look identical, but there may be the word "credit" or "debit" somewhere on the card. A credit card doesn't connect to your bank account.

However, it will add all of your transactions to your credit card bill. You must pay off the balance each month, or you’ll have to pay interest on the money you borrow since the card works like a loan.

At bunq, we offer an option that acts like a credit card, but doesn’t let you fall into debt. So it works like a debit card, but you’re able to book hotels, rent cars, or use it whenever they ask for credit cards. 

How you get it🙌

To get a (real) credit card, you’ll need to apply for it. You can do this either through your bank or through a variety of credit card companies.

When you apply, you’ll learn if the company approved you. Then, you may be able to choose between different cards with unique perks or interest rates.

Depending on your application and your credit history, you may get a large or small credit limit. If you spend more than the limit, your card will decline until the following month.

Where you use it💳

Like a debit card, you can use a credit card in many places in person and online. It's a good card to use if you tend to keep most of your money in a savings account.

That way, you don't have to consistently replenish the money in your checking account. Also, credit cards tend to offer more protection than debit cards in the case of fraud.

So using your credit card is a good option if you don't quite trust who you're paying. If someone hacks into the portal and gets your credit card number, you can report the fraud to get your money back.

P.S.: if you’re looking for the ultimate protection, you can always use DigiCards at bunq. These are virtual cards that you can create, use, and disable immediately - so your information is always safe. 

What is a prepaid card❓

A prepaid card is similar to a debit card in that it has a set balance, and you can usually refill it. However, you won't connect the card to a bank account, so you'll need to refill the balance manually.

You may have used a prepaid card like a gift card or a general prepaid card. These cards let you buy things online if you don't have a bank account, and you can usually refill them using cash.

Like a debit card, your prepaid card balance will decrease when you use it. But you won't have to pay interest like you would with a credit card.

How you get it🙌

You can find a prepaid card at many retail stores or even online. When you buy the card, you will pay the amount you want to load onto the card and sometimes a small processing fee.

If someone wants to give you money, they may give you a prepaid card to use. This is a great option for sending money through the mail since you may not want to send cash.

Where you use it💳

You can use a prepaid card in the same places as a debit or credit card. It should work in most in-person stores as well as online, which is great.

When using the card online, it can work as a virtual card. You'll enter the card number and expiration date, and you can spend the entire balance at once or over time.

If your balance runs low, you can return to a store or go online to add more money to the card.

What card to choose🌈

Be sure to compare your choices, and don't be afraid to get multiple cards. That way, you can use the best one for each purchase you make. While debit cards may be better for your day to day life, you’ll probably need a credit card to make certain reservations, for example when traveling.

Are you ready to get a bank account and cards that fit all your needs? Download the bunq app and get started today.

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