A debit card is directly linked to the financial institution; and for every transaction made, money is debited from it. Credit card enables you to borrow money by allowing the issuer to pay for your purchases. Albeit their similar looks, there is a vast difference between credit card and debit card.
Application process
Debit cards are easy to obtain; unlike credit cards which have a detailed application process demanding proof of repayment capabilities, and a good credit score.
Billing
There is no monthly billing for debit cards. You get monthly bills in case of credit cards, and credit card payment must be done every month.
Spending limits
Debit cards allow you to spend only the amount that is present in your account. Whereas with credit cards, you can borrow till you reach your credit limit.
Security and fraud liability
Both the cards are integrated with high security. But the greatest difference between credit card and debit card is that credit card users can claim the charge back in case of malicious activity. Debit card users cannot enjoy this feature.
Rate of interest
Debit cards have no interest rate, while credit cards come with a high interest rate. This interest is charged on the outstanding balance, and you can circumvent it with timely credit card payment.
These are the differences between the two you must be aware of before availing for any.
Also Read: How to choose the right Credit Card?
