Advantages and Disadvantages of a Debit Card

Credit card and debit card are two different aspects of plastic money with different advantages and disadvantages. As you have read a lot on credit cards, in this post you fill find some numerous advantages and disadvantages of debit cards.

Advantages of Debit Cards

Debit card does not match with credit card’s qualities much more hence it has some of advantages that you can’t get in a credit card. These are:

• Like credit cards, debit cards are accepted by merchants because of its easiness, safety and quick money transaction utility which makes it more comfortable for business than a paying check.
• In a debit card you have to pay only one time fee with no extra interests or surcharges like late fee, APR, etc. which is a common element in every credit card. You can utilize it as an alternative for credit card at zero costs in comparison of a credit card.
• Similar to credit cards, a debit card can be used at anywhere, anytime for any buying until you have enough payment in your bank account. You can use it to make online purchasing where you can’t pay through cash or paying check or if you don’t have a credit card.
• You can use your debit card to obtain cash from an ATM without paying any extra charge for which you have to pay a higher fee if you obtain cash from your credit cards.
• Anyone who has bank account can obtain a debit card even if he/ she does not maintain a good credit report thus it is a good alternate for people with bad credit report or FICO score. Further more it never brings you credit card bankruptcy until you don’t want to pay overdraft fee.

Disadvantages of a Debit Card

• As debit card does not offer credit facility to its user, some banks introduced a new feature ‘overdraft’ (not exactly but similar to credit limit) so you can withdraw more amount than you have in your account. Certainly they charge for it too, sometimes it may be very high.
• Some banks have amended their terms & conditions clauses by adding a term of maintaining a minimum balance in your bank account. If you don’t follow the rule bank will charge fee for non-sufficient funds or over-limit fee.
• In some countries debit card does not offer much security than credit card because of its direct connection to the holder’s bank account. If someone steals it to get cash, you will have to suffer financial loss but in credit cards you can stop payment due to it takes enough time to take an action. Besides it credit card companies offer fraudulent alert utility (with a time limit up to 60 days) to credit card users so they can stop any suspicious activity on time in order to minimise credit card fraud, this facility does not come with debit cards.
• Some debit cards don’t offer safety and security because of loopholes in concerned countries’ laws even a debit card is easier for hackers than a credit card.

Though debit card has more advantages than disadvantages and offers good services like credit cards with less security, it is a good way to use plastic money. You can use it to make your purchasing with proper safety precautions so avoid any debit card disadvantages.