BANK ACCOUNTS
Why Use Debit Cards
Cash-less society has gradually becoming a reality because of the convenience that plastic debit or credit cards provide. Although it has been constantly been rocked with anomalies and frauds, it has never loss its appeal to convenient-hungry public. Debit or credit cards are highly reliable but when you think of their pros and cons, using debit cards to make payment and purchases seem to have more advantage. But before you decide to use debit cards instead of credit cards, make sure that you clearly talk with your bank about their overdraft rule. Read over the agreement so you what to expect if you will make a payment more what you have in the bank.
There are some invaluable benefits of using debit cards rather than using credit cards for your everyday spending. Since your credit limit is only equal to how much money you have in the bank, it will not give any chance for a person who is planning to commit fraud to get an amount more than what you have in the bank. Compared to credit cards, the person behind the scam can rake up any amount up to your credit limit. This will bring you more trouble especially when you have a high credit limit.
If you are an impulsive shopper, debit cards will save you from further incurring debts beyond your means. Having this in mind, you will be force to allocate your resources properly and will be thinking of ways on how to stretch your money on hand. Debit card use will train you to become a cautious spender. In contrast, credit cards will most likely turn you into a reckless spender since you can make purchases even you don’t have any cash on hand.
There are two types of debit cards. The division was made in order to make a distinction on what will happen to your transactions if you don’t have enough funds left on your bank account. If you have a solo or electron card, your balance will first be checked every time you want to make a payment. When the system finds out that the purchasing amount is larger than what you actually have on your account, the payment will be declined. However if you have a Switch or Delta card, this will not check your balance whenever you make transaction and regardless if you have available funds or not the payment will usually push through.
If you have an overdraft agreement with your bank, you have to make an extra interest every end of the month but are usually lower than credit card company charges. On the other hand, not having any overdraft agreement with your bank will mean that on top of the principal debt and interests, you still have to settle an overdraft fee that will usually run every day until you have settled your debt.
Debit cards enjoy the convenience of what credit cards bring; although you will sometimes be asked to give more information written on your card, you will be allowed to make a transaction over the phone or the internet. Protection from fraud transaction is now being reviewed and will soon get the same security that credit card enjoys.
Tags: credit card, debit cards, delta card, electron card, switch