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Credit or Debit cards. Which is better?

By News Canvass | Feb 03, 2022

For a novice, the world of credit and debit cards might be bewildering, since each has its own set of features and benefits. This blog serves as a resource to help you understand how credit and debit cards work.


A credit card is a card that allows the cardholder to borrow money from a financial institution, usually a bank. Cardholders agree to repay the money, with interest, according to the terms of the institution. There will be a credit limit set, which you will not be able to exceed. This credit limit is determined by a variety of factors, including such as salary, credit history, employment stability, and so on.

A 45-50 day interest-free period is offered on credit cards. So, if you pay off all of your credit card debts on time, then you won’t have to pay any interest on your purchases. Cash advances (withdrawals), on the other hand, are not eligible for the interest-free period. In case you can’t afford to pay the whole balance on your credit card, banks will let you pay a minimal amount and let the remainder of the debt roll over. On a daily basis, financial charges (interest) will be applied to this outstanding sum.


1] Credit cards are convenient to carry and use and far better than carrying liquid cash.

2] They are much safer because the user is only liable in the event of credit card fraud.

3] Provide additional financial security. One can utilise them when you’re short on cash.

4] Possibility of earning in the form of rewards and cash back as you spend.

5] As a milestone benefit, credit cards give a variety of privileges such as access to airport lounges, gift certificates, and freebies.


1-High yearly interest rate which can range from 25% to 45 percent.

2-Have additional fees and penalties, such as an annual fee, a renewal cost, a late payment penalty, and so on.

3-A debt cycle begins when you skip credit card payments and continue to overspend.

4-Credit cards, with the exception of some specialised cards, are normally fairly costly for overseas use.

5-Failure to pay a credit card bill has a direct influence on your credit score. 


1] Standard credit cards provide its users with a line of credit that they may use to make purchases, debt transfers, and/or cash advances, and they usually don’t have an annual fee.

2] Premium cards provide privileges like concierge services, access to airport lounges, and exclusive event access, among other things, but they generally come with higher yearly costs.

3] Customers who use Rewards cards receive cash back, travel points, or other perks based on how they spend.

4] Low introductory interest rates and fees on balance transfers from another credit card are available with Balance transfer cards.

5] Secured credit cards need a cash deposit that is retained as collateral by the issuer.

6] Charge cards don’t have a defined spending limit, but they frequently don’t let unpaid amounts roll over.


A debit card is a payment card that deducts money directly from a consumer’s checking account rather than relying on a bank loan to make payments. When issued by major payment processors such as Visa or Mastercard, debit cards provide the same convenience as credit cards and many of the same consumer protections.


a] Standard debit cards draw on your bank account.

b] State and federal agencies provide electronic benefits transfer (EBT) cards to allow qualified users to use their benefits to make purchases.

c] Prepaid debit cards allow consumers who do not have access to a bank account to make electronic purchases up to the amount preloaded on the card.


1] No debt involved since you are using your own money.

2] It is less expensive to use because there are no interest charges.

3] It also functions as an ATM card, allowing you to withdraw cash from an atm.

4] Obtaining approval for a debit card is simpler and quicker.

5] Doesn’t assist in the building of a credit history.


1) Inability to leave disposable cash in your account since money is directly debited.

2)  If you don’t keep track of your expenditures, it might be difficult to balance your  passbook at the end of the month.

3) Withdrawal charges if you use a different ATM

4) When it comes to debit card fraud, there is absolutely little security.


Credit cards and debit cards each have their own set of benefits and drawbacks. Here are some examples of when each might be preferable.

1] If you have a spending issues use Debit card : Because the money comes from your savings or current account, you are less likely to overspend and wind up in credit card debt 

2]Use your debit card to withdraw money because you are getting access to your own money and there are no expenses involved. When you withdraw money with your credit card, however, you are withdrawing money that you do not have. The bank will classify this as a form of loan that you will be required to repay with a high interest rate.

3] When purchasing online, credit cards are the safest option. You may always contact your bank and get your card blocked if you suspect fraud. Furthermore, reversing a charge to your credit card is significantly easier than reversing a charge to your debit card.

4] When travelling on a foreign trip, you may use a credit card as they are universally accepted. Keep in mind that if you swipe your card overseas, you will be charged a foreign currency mark-up fee.

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