What is a Debit card? How does it work?
A Debit Card combines the functions of an ATM card and a cheque. When you pay with your Debit Card, the
shopkeeper swipes your card through an electronic point of sale (EOS) terminal, directly linked with the issuing
bank. When this is done, the cardholder’s account immediately gets debited. So, let’s say you spend Re. 520 at
a shop, your account instantly gets debited accordingly. Debit cards are issued by banks, but are used at
stores.

What are the types of Debit Cards?
One is the personal identification number (PIN) based card and the other, the signature-based card. In India,
MasterCard issues the PIN based card in association with Citibank, while Visa International issues the
signature-based card in association with HDFC Bank. While the PIN-based card is thought to be more secure,
the signature-based card is more widely accepted in India.

How much does the card cost?
A Debit Card is much cheaper to have than a credit card. A number of banks issue the debit card. The debit
card is still in its infancy in the country but more banks are issuing the card and the card usage is increasing.

What is the difference between credit and debit cards? If you have both, when
will you use the credit card and when the debit card?
A credit card offers you credit for a given period, usually about 45 days. With a debit card, there’s no interest
or bill to be settled separately, as your bank account is immediately debited. Also, when you apply for a debit
card, you do not need to go through a credit check.

All you need is a bank account. A debit cardholder cannot spend on his card if he lacks sufficient balance in his
account. Customers tend to use credit cards in high value transactions and debit cards for lower value goods or
services.

Does a debit card holder have to pay if there’s a mistake in his debit card
statement?
Although the chances of errors in a debit card statement are remote, mistakes can still occur. If you find an
error in your statement, notify your bank immediately. Normally, a bank has 10 business days from the date of
your notification to investigate the problem. If the bank needs more time, it can take up to 45 days, but only if
it deposits the amount in dispute into your account. If the bank later determines that there was no error, it can
take the money back, but it must first send you a written explanation.