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Debit Cards

What are Debit Cards?

Debit cards, also known as bank cards or check cards, are payment cards acting as a cash alternative. They can be used to make purchases or access ATMs. Those cards are linked to a checking/savings account and directly transfer money from your account to the other party during transactions.

Components of a Debit Card

  • Card number – The 16-digit number on the front of the card that identifies your account for transactions.

  • Cardholder's Name – The name of the person authorized to use the debit card, printed on the front.

  • Expiration Date – The month and year when the card expires, usually located below the card number.

  • EMV Chip – A square chip embedded in the card providing enhanced security for in-person transactions.

  • Magnetic Stripe – A stripe on the back containing data used for transactions when swiped.

  • CVV/CVC Code – A three-digit security code on the back of the card, used to verify online or over-the-phone transactions.

  • Bank Logo – The logo of the bank that issued the debit card, typically on the front.

  • Payment Network Logo – The logo of the payment network (such as Visa, MasterCard, or American Express) that processes transactions, also on the front.

  • Signature Panel – A strip on the back where the cardholder is required to sign, which is used to verify their signature during transactions.

  • Contactless Symbol – Indicates that the card is enabled for contactless payments, allowing you to tap the card on a reader for transactions.

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Using Your Debit Card

Using a debit card is fairly straightforward, though the process differs based on how you are making the transaction. 

 

For physical purchases, if vendors have a card reader, you can scan or swipe your card, depending on if you have a contactless symbol. 

 

Online purchasing is a bit more tedious. The checkout will prompt you to enter your card number and provide your CVV/CVC code and expiration date. You will also need to provide a billing address. In some situations, you may need to specify the payment network the card uses. 

 

When purchasing over the phone, you will be asked for similar information. Be sure to have your payment network, card number, CVV/CVC code, and expiration date ready. After providing the representative with your info, you may be retold the price for confirmation. After verification and transaction processing, you'll receive a confirmation number or receipt for your records.

At an ATM, you will insert the card into the slot. Afterwards, enter your Personal Identification Number (PIN). This is a 4- to 6-digit number that only you should know, so don’t let anyone else see it. When complete, you have the option to withdraw cash, check balance, deposit money, or transfer money. If you’re withdrawing or depositing money, you’ll need to enter the amount. Machines might have preset amounts, or let you provide a custom one. Confirm your transaction, take the money if applicable, and collect the receipt. 

Getting the Right Debit Card

Debit cards have varying features depending on the provider and package, so be sure to consider them as you pick your card! Here are some things to look at:

  • Rewards Programs – Certain debit cards offer rewards like cashback, discounts, or points for purchases, similar to credit cards.

  • Fees – Cards have varying types of fees of differing values. Be sure to look at the costs and criteria as you pick your card.

    • Monthly fees – Banks may charge a monthly fee for maintaining a checking account that comes with a debit card. This can often be waived. 

    • ATM fees – Some cards charge you for using ATMs from other payment networks, or in foreign nations.

    • Foreign transaction fees — Making purchases in foreign currencies might lead to being charged a foreign transaction fee.

    • Replacement card fees – At some banks, getting a replacement card will result in a fee.

    • Inactivity fees – Some cards charge a fee when unused for a period.

    • Balance inquiry fees – Some banks charge a small fee when you check your balance at an atm, particularly if it’s out-of-network

    • Point-of-sale fees – There may be a fee for using your debit card at a point-of-sale terminal, though it’s uncommon. 

    • Insufficient funds fees – If you attempt a transaction without enough funds in your account and don’t have overdraft protection, the transaction may be declined, and you could be charged a fee for insufficient funds.

    • Annual fees – Some premium or specialty debit cards may charge an annual fee.

    • Paper statement fees – If you choose to receive paper statements instead of electronic ones, your bank may charge a fee.

  • Overdraft protection – Some debit cards offer overdraft protection, allowing transactions to go through even if your account balance is insufficient, generally with a fee.

  • Mobile Payment Compatibility – Cards can often be linked to mobile wallets like Apple Pay. 

  • Zero Liability Protection – Many debit cards offer zero liability protection for unauthorized transactions, provided you report it promptly.

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TL;DR

  • Debit cards are payment cards linked to your checking or savings account, allowing for purchases and ATM access by directly transferring money.

  • Cards include a card number, cardholder's name, expiration date, EMV chip, magnetic stripe, CVV code, bank/payment network logos, signature panel, and contactless symbol.

  • For in-person purchases, simply swipe, insert, or tap the card at terminals.

  • When online purchasing, provide the card number, CVV code, expiration date, and billing address. Similar info is needed for over-the-phone purchases. 

  • To use the card at an atm, insert the card, enter your PIN, choose a transaction (withdraw, deposit, etc.), and confirm.

  • When choosing a debit card, consider features like rewards, various fees (e.g., ATM, overdraft, foreign transactions), and additional services like mobile payment compatibility and zero liability protection.

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