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    Credit & Debit Cards

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    Dhrisha Gada
    A credit card allows users to borrow funds from a financial institution like a bank, while a debit card directly deducts money from a user's checking account. Credit cards offer benefits like easy access to credit, building credit history, and purchase incentives, but disadvantages include potential debt traps, hidden fees, and high interest on unpaid balances. Debit cards provide alternatives to cash and immediate fund transfers, but have limitations like identity theft risks, transaction limits, and terminal dependency.

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    Credit & Debit Cards

    Uploaded by

    Dhrisha Gada
    52 views3 pages
    A credit card allows users to borrow funds from a financial institution like a bank, while a debit card directly deducts money from a user's checking account. Credit cards offer benefits like easy access to credit, building credit history, and purchase incentives, but disadvantages include potential debt traps, hidden fees, and high interest on unpaid balances. Debit cards provide alternatives to cash and immediate fund transfers, but have limitations like identity theft risks, transaction limits, and terminal dependency.

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    Credit & debit cards

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    A credit card allows users to borrow funds from a financial institution like a bank, while a debit card directly deducts money from a user's checking account. Credit cards offer benefits like easy access to credit, building credit history, and purchase incentives, but disadvantages include potential debt traps, hidden fees, and high interest on unpaid balances. Debit cards provide alternatives to cash and immediate fund transfers, but have limitations like identity theft risks, transaction limits, and terminal dependency.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as docx, pdf, or txt
    52 views3 pages

    Credit & Debit Cards

    Uploaded by

    Dhrisha Gada
    A credit card allows users to borrow funds from a financial institution like a bank, while a debit card directly deducts money from a user's checking account. Credit cards offer benefits like easy access to credit, building credit history, and purchase incentives, but disadvantages include potential debt traps, hidden fees, and high interest on unpaid balances. Debit cards provide alternatives to cash and immediate fund transfers, but have limitations like identity theft risks, transaction limits, and terminal dependency.

    Copyright:

    © All Rights Reserved
    Download as DOCX, PDF, TXT or read online from Scribd
    Flag for inappropriate content
    Download as docx, pdf, or txt
    of 3

    Credit/debit card transactions

    What Is a Credit Card?

    A credit card is a card issued by a financial institution, typically a


    bank, and it enables the cardholder to borrow funds from that
    institution.

    What Is a Debit Card?

    A debit card is a payment card that makes payments by deducting


    money directly from a consumer’s checking account, rather than
    on-loan from a bank or card issuer.

    Advantage & Disadvantage of Credit Card


    Benefits of Credit Cards:
    1. Easy access to credit
    2. Building a line of credit
    3. EMI facility
    4. Incentives and offers
    5. Flexible credit
    6. Record of expenses
    7. Purchase protection

    Disadvantages of Credit Cards:


    1. Minimum due trap
    2. Hidden costs
    3. Easy to overuse
    4. High interest rate
    5. Credit card fraud
    Advantage & Disadvantage of Debit Card
    Benefits of Debit Card:
    Prepaid Card 
    Nominal fee
    Alternative to Cash
    Immediate Transfer of Funds
    Instant Withdrawal of Cash
    Easy to Manage

    Disadvantages of Debit Card:


    Unprotected against identity
    Limit of transaction
    Terminal Dependent
    Processing and maintenance charge
    Limit to fund access
    Security threat

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