They look the same… they must be the same, right? In actuality there are many differences between a credit card and a debit card.

For starters, the main difference is that using a debit card subtracts the transaction amount from a balance of money you already have (pay now) while a credit card allows you a credit limit, which you can pay for at the end of the month (pay later).

How do debit cards work?

• You don’t have a credit limit.
• You are simply spending the money saved up in the current or savings bank account linked to your debit card.

How do credit cards work?

• Depending on your credit history, employment and other financial matters, the bank will decide on a credit limit.
• When you use a credit card, you are being “lent” money and are expected to pay it back.
• You usually have 30 days to pay ...