What is Debit Card? Types of Debit Card.

A debit card is a payment card that can be used instead of cash while making any purchase or transaction and the money will be deducted directly from customer’s checking account. Debit cards are much safer and convenient than carrying cash. Usually debit cards have daily purchase limits and that’s why one cannot make large purchases with debit cards and unlike credit cards, debit cards do not let user’s go into debt. Debit cards serves dual purpose, on one side they can be used for withdrawing money from automated teller machine (ATM) and on the other side they can be used directly for purchasing anything.

what is debit card, types of debit card, how does debit card works

Debit cards are also used for making purchase on internet and this purchase is authenticated by entering Personal Identification Number (PIN) for enabling secure transaction. Debit card is easy to obtain and once you will open your account with any ban or financial institution you will immediately receive it. Debit cards are also widely accepted and you will not have to worry about carrying the cash everywhere.

Types of Debit Cards

  1. Offline Debit Card

The offline debit cards can be used at the point of sale such as credit card because it is a combination of both credit card and debit card. These types of debit cards are subjected to daily limit and after exceeding the limit the payment will be declined. The transactions made by offline debit card require 2 to 3 days to be reflected on customer’s account balance. In offline debit card no Personal Identification Number (PIN) is required but user’s signature is compulsory in sales receipt.

  1. Online Debit Card

The use of online debit cards requires electronic authorization of each and every transaction and the debit will be reflected immediately on customer’s account. The transactions made by online debit card are secured with Personal Identification Number (PIN) authentication system while some cards also requires authentication for every transaction especially at automated teller machine. One difficulty with using online debit cards is that they require electronic authorization device at the point of sales (POS) and sometimes a separate PIN pad for entering the PIN.

  1. Electronic Purse Card System

Electronic Purse Card System is smart cards with microchips in which value is stored on the card chip. Not network connectivity is required for using this card. This card is generally used for small transactions.

  1. Prepaid Debit Card

Prepaid Debit Card is issued by the prepaid card companies, banks, retailers and credit card companies. Prepaid Debit Card can benefit the people having bank account as well as people who do not have bank account because these are offered directly by retailers and credit card companies. Unlike other debit cards Prepaid Debit Card is not linked with customer’s checking account. For shopping from Prepaid Debit Card one will have to load money in this card and then only they can use it for transactions and one cannot spend more money than loaded in the card. This feature is very beneficial because it makes customer control their expenses. Prepaid Debit Card can be used wherever payment network like Visa and Master cards are available.

Guidelines for preventing loss 

  1. Try memorizing the Personal Identification Number (PIN) number instead of writing it down somewhere.
  2. In case of losing the of debit card always notify the financial institution first for preventing any unknown transaction.
  3. Always try keeping the receipts of debit card transactions so that you can immediately investigate any unknown transaction.
  4. Always use chip-enabled technology for stronger protection

If you all find this article helpful enough for you or if you still have queries regarding the same then please let us know by commenting down in our comment section. We will be pleased to hear from you.

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