The Difference Of Credit Cards And Debt Cards

Credit Cards

A Credit card must be approved by the credit provider, the bank, before the cardholder can use it to pay with at merchants who accept this card. Most cards have a maximum amount of credit to be used by the holder.

When you make a purchase you will be asked to sign a receipt with the record of the card     details and the amount to be paid. If the card has a chip you can be asked to enter the PIN

number ( personal identification number). Many merchants also accept authorization through the telephone or an internet approval called a CNP transaction ( Card/Cardholder Not Present)

This electronic verification system allows merchants to check if the card is valid and the cardholder has sufficient credit to cover the payment in seconds. For the verification a terminal or POS system (Point of Sale) is used and the data on the magnetic stripe or the chip is read for this purpose.

The cardholder receives a monthly statement with the purchases made and the all amount

to be paid. If the card user pays a minimum portion of the outstanding debt interest is charged which is very often of a higher rate than a standard loan interest. 

Debit Cards

Debit Cards are also called Check Cards or Bank Cards. It is called an electronic Check Card, because the funds are withdrawn directly from either the bank account, or from the remaining balance on the card. For payments over the internet no physical cards-are issued. To withdraw cash from an ATM machine Debit cards can also be used. 

There are 3 types of payments with a Debit Card: 1 The PIN debit or online debit , 2 the signature debit or offline debit and 3 the Electronic Purse Card payment.

Although the majority of the debit cards are of the Visa or MasterCard brand, there are many other types of debit card which are only accepted within a particular country or region: 

Switch (now: Maestro) and Solo in the United Kingdom, Inter ac in Canada, Carte Bleue in France, Laser in Ireland, "EC electronic cash" (formerly Eurocheque) in Germany and EFTPOS cards in Australia and New Zea land. The need for cross-border compatibility and the advent of the euro recently led to many of these card networks being re-branded with the internationally recognized Maestro logo, which is part of the MasterCard brand.

Some debit cards are dual branded with the logo of the (former) national card as well as Maestro (e.g. EC cards in Germany, Laser cards in Ireland, Switch and Solo in the UK, Pin pas cards in the Netherlands, Ban contact cards in Belgium, etc.).