Must-Follow Tips When Choosing A Debit Card

Are you here to learn a little about tips associated with choosing the best Debit Card and what the details are all about for your account protection or wondering how to use your Debit Card to the best extent possible, then perfect! You have found the right article.

In this article, I’m going to give you all the Debit Card facts and details that you need to know about to help you out with choosing your new Debit Card to benefit you the most.

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About Debit Cards

When making a payment using your Debit card, the amount is deducted like an electronic check directly from your checking or savings account that you link to your account.

You can also use the debit card at retail stores or gas stations or ATMs (automated teller machines) or online, and more just like a credit card. The debit card will not build credit in most cases, and you can only charge or spend the amount you have in your debit card account, unlike a credit card.

The positive side of a debit card vs. a credit card is that you can pay for your purchases without paying the interest you would if your credit card had an outstanding balance. 

It’s faster than writing a check or carrying a large amount of cash, and if you need a bit of money, you can get cash back when you make purchases at a store.

Choosing A Debit Card

Debit, credit, and prepaid cards look the same but are very different, so choosing a payment card should know how it works and how much fees, limitations, and other costs are involved.

Bottom line, choosing a payment card means knowing the different interest rates and fees, conditions, and terms between the most common types of debit cards, credit cards, and prepaid cards. This article focuses on debit cards and knows the differences that should help you select.

Most Accepted Debit Card 

  1. Visa 
  2. Mastercard
  3. Discover
  4. American Express

Visa Is Better Than Mastercard and both cards are accepted everywhere around the world. However, Visa has a bit more benefits as even the most basic Visa card level still has features, for example, stolen or lost card reporting.

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Best Debit Cards to Pick 2022 – 2023

  • SBI Debit Card.
  • HDFC Debit Card.
  • Axis Bank Debit Card.
  • ICICI Bank Debit Card.
  • Yes Bank Debit Card.
  • Kotak Mahindra Debit Card.
  • HSBC Debit Card.

Types Of Debit Cards: 

  • Check Cards. This is the most common type of debit card.
  • EMV Debit Cards. 
  • ATM Cards. 
  • Prepaid Cards. 
  • Gift Cards.

Differences Of Debit, Credit, and prepaid cards.

With a debit card, you will link your checking account and can spend the amount you have in your checking account unless you have overdraft protection to spend up to the agreed terms of the issuing bank.

With a credit card, your payments are virtually borrowed money. You must pay back the full amount by a specified date. You will incur an additional interest rate payment on any unpaid balance according to your credit limit if you don’t.

With a prepaid card, your payments are like you are paying cash because the card is not linked to a checking account, and you aren’t borrowing money; but instead, you are spending only the amount that has been loaded to the card.

(Many different prepaid cards such as gift cards, employee benefit cards, government benefit cards, payroll cards, employee benefit cards, loyalty cards, and more. All have different terms and conditions, of course.)

Eligibility Qualifications.

With a Debit card, you will need a bank to link your checking account to your debit card or where your social security benefits or government disability payments are linked to your debit card and link to that account.

With a credit card, you will apply for credit based on your ability to qualify to meet minimum payments on time by credit history and employment verifications. 

Your credit amount will reflect the verification process to what you are eligible for depending on income, assets, and any other obligations such as car payments, house payments, or child support, for example.

The above requirements are not needed with a prepaid card as your money is from what you load onto the card account. 

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Card Fees 

Depending on your issuing bank, your fees will vary. When choosing your debit card, compare the fees to know what is best for you.

Debit card fees can include ATM (automated teller machine) fees, overdraft, bill payment, account to account transfer fees, and more.

Credit card fees are normally interest charges, late payment fees, annual fees, card replacement fees, and more. 

Prepaid card fees can include ATM withdrawal fees, cash reload fees, balance inquiry fees, inactivity fees, account-to-account transfer fees, card replacement fees, decline fees, card cancellation fees, and more.

Researching fees pertaining to your card can be key in your decision-making before you choose so as not to have any unwanted surprises later.

Merchants can temporarily “block” or “hold” funds in your account.

Merchants can temporarily put a hold on your account to help protect against fraud or other losses. 

Hotels sometimes put a hold on your card to reserve your room reservation until the payment is made when you arrive.

Another example is at gas stations, and sometimes the clerk will swipe your card for $30 or the amount you will be possibly purchasing as approval from your issuing bank before you pump gas, and then the actual amount is swiped after you have your gas. The first charge might take up to 48 hours to show up on your card account by the time the bank has time to reverse the hold amount, so you won’t have access to the hold amount until such time it’s reversed.

Since payments are made electronically, there is a small amount of time, normally within 24 hours, to be posted on your account. In some cases could overdraft your account since the bank won’t know other purchases or withdrawals you made until the end of day closing.

An example of a purchase you wish to make for a $100 item and only have $50 in your debit card account, your bank might approve the transaction but you will incur an overdraft fee on top of your purchase and any more purchases until you settle your deposit.

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Debit Card Fraud

A top priority should be your personal information, so always take steps to protect your information safe by not giving out your card number (PIN), Personal Identification Number, or security code to anyone. Memorize your PIN instead of writing the number down.

Even though you would not be responsible for those unauthorized transactions if a fraudster uses your personal information, there would be a major hassle to resolve the situation that could have been avoided by being careful. 

Tips Preventing Debit Card Fraud

  • If you don’t recognize a number on your caller ID, you can click this link here by the (FCC) Federal Communications Commission to read more before a fraudster calls you. 

(It’s called Spoofing your caller ID. It also is sad because it leads you to believe that it will be okay to answer the questions by the fraudster.)

  • Never allow your account number, expiration date, security code, and PIN to be known by anyone else. That information can be used to access your account to create counterfeit cards.
  • Don’t be rushed into any decision, especially to send money.
  • Investigate if they say you won prizes or something that they need to verify your card account.
  • The American Bar Association actually advises you to trust in your natural instincts. You know that feeling when it doesn’t feel right.
  • Internet scams try to get you to reveal information or make money transfers or pleas for money to help someone online that you just met.
  • Cover the keypad at ATM or gas pumps and never allow a clerk to run your card through two different scanners as they may be dishonest and are capturing your identity on your debit card to make a counterfeit card.
  • Ask your bank for a virtual card if using online purchases to help protect your account.
  • Check your account frequently to keep up with all transactions and make sure you authorized all in case you need to report a problem asap to help authorities get a head start in preventing fraud.