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Difference between credit card and debit card – What you should know

Two major pillars of digital banking today are credit and debit card. Today, everyone has either of them or most times, both. These cards are very important and used in the cycling of money across daily needs. However, although similar, they are ultimately not the same, if not they both wouldn’t exist. This article goes in-depth, majorly discussing the difference between credit and debit cards.

Also, common knowledge is that a debit card draws money from your account, while the credit charges withdrawal to your credit line. Although they operate in a similar fashion, there is a distinction on where the card pulls money from. We would explain later as we go on.

What is a debit card?

A debit card is simply an internet banking card that has the capacity to draw funds directly from your bank account. Therefore, the card is linked to your bank account, and when you make a purchase, it debits funds from there. Also, transactions using a debit card works swiftly, as approval takes mere seconds due to digital advancements. However, it could also take a few hours to days depending on the other factors. Also, it does not usually come with interests.

What is a credit card?

A credit card is basically debit card in reverse. It helps you borrow money instead and adds the charge to your credit. However, credit cards usually work with a line of credit called the card’s credit limit. What this means is that you have a cap on the maximum amount you can borrow. Basically, using a credit card means the bank pays the dealer on your behalf, and later on, you pay the bank. Most times, credit card payments usually come with high-interest rates, meaning you’d eventually pay more than you spent. Also, interest accumulates when you carry over a balance from one month to another. Overall, customers are judged by a credit score by credit bureau companies. You can see what a credit card generator is here.

Can I use debit card as credit card?

Yes, technically you can. This is because a debit card could act as a credit card when you intend to make a payment. Furthermore, the difference is that the charges deducted would be from your bank account, therefore it has to contain that exact amount or more. However, for credit cards, you do not need to have the amount, as the sum would simply be added to your line of credit, which you can pay off later. This is why payment options usually have only the “pay with credit card option” and not pay with credit or debit cards separately.

What is the difference between credit and debit card?

The major difference between a credit card and debit card is that one works directly with your account balance, while one works with your line of credit. With a debit card, you are limited to the amount available in your account, while a credit allows you to go overboard. Therefore, as long as it’s not above your credit limit, you can purchase anything you want.

Using a debit card helps you live within your means and also does not come with interest or fees when you purchase stuff. However, credit cards are very useful for emergencies, when you have to meet sudden expenses. This is what it is best used for as free-spending with a credit card could land you into serious debt.

Is ATM card a credit card?

No, an ATM card is not a credit card. This is because they are linked directly to your account, and only fund withdrawal or payments when you have enough funds in the account. Therefore, outside that, you cannot carry out any transactions. ATM cards are debit cards.


Credit and debit cards are equally useful for everyone. However, they should be used carefully, and in appropriate situations, especially credit cards. Although credit cards could help you afford what you normally can’t, they could also land you in serious debt.