Debit cards

Debit cards are a type of credit card provided by banks to their customers in order to facilitate cashless payments and cash withdrawal from automated teller machines (ATM). The card is usually made of plastic featuring a magnetic strip and an electronic chip. In contrast to credit cards, the checking account is immediately debited when paying by debit. If the credit balance of the associated account is exhausted or an availability limit is reached, the debit card can no longer be used.

Although the scope for payment is somewhat limited, this also leads to better control and security. Thus, debit card holders benefit from the flexibility of the credit card function, without risking a bad surprise at the end of a billing cycle.

Security in payment transactions

Each debit card has a personal identification number (PIN). This must be entered to validate all transactions made with the card, such as the cash withdrawal at the machine. This can prevent unauthorized third parties from accessing the account.

Popularity of debit cards

Debit cards are easily accessible and therefore reach a broad portion of the population, making it one of the predominant payment methods. Merchants looking to address a broad customer segment will find this payment method useful. Banks automatically issue a debit card for each account opened, without any minimal income requirement. In addition, no annual or similar fees are charged, making the card attractive to customers.