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What’s the Difference Between a Debit Card and a Credit Card?

By Sabrina Loh

It’s easy to confuse debit cards and credit cards when they look so similar — they both have 16-digit numbers embossed on the front, the card holder’s name, a magnetic stripe on the back, an embedded chip, and a security code.

Although they look identical and can both be used as a form of payment, the similarities end there.

What is a debit card?

Debit cards draw money directly from your checking or savings account when you make purchases. They can also be used to withdraw cash at ATMs.

To use it, you must have enough money in your account or you risk the payment being rejected or drawing an overdraft with expensive fees.


  • You don’t accumulate any debt when you pay with your debit card, because you’re withdrawing money from funds you already have.

  • You don’t have to pay interest on your purchases.

  • It’s great for controlling spending.


  • If you don’t keep track of how much money you have left in your account, your card could be rejected, or you risk paying expensive overdraft fees.

  • Spending with a debit card doesn’t help you to build your credit score.

  • You don’t earn any rewards, points, miles, or cash backs on purchases made with a debit card.

What is a credit card?

A credit card allows you to borrow funds from the bank for purchases. The bank pays the merchant first, then later, you pay the bank back when you receive the credit card bill.

When you spend with a credit card, you usually have 30 days to pay back the balance in full before any interest is charged. If you carry the balance to the following months, you’ll be charged high interest.

Unlike debit cards which are issued to everyone with a bank account, you must qualify for a credit card to obtain one. This is done by reviewing your salary and creditworthiness — the better your credit score, the higher your credit limit.


  • Credit cards can be used to raise your credit score when you spend responsibility and make on-time payments. A better credit score, in the long run, will help you to qualify for better interest rates and loans.

  • Credit cards provide rewards, points, miles, or cash back whenever you spend, which can be beneficial.

  • Credit cards are convenient for emergencies. Putting an unplanned charge on your card will give you some extra time to pay it off.


  • You’ll always run the risk of racking up debt when spending with a credit card because you’re the bank’s money, not your own. This is especially dangerous if you tend to spend impulsively.

  • If you’re unable to repay the bill on time, you’ll have to pay interest on top of the existing bill and late charges, which can get expensive quickly.

Missing your credit card payments could damage your credit score, making it harder to apply for a loan in the future.

Which should you choose?

When trying to determine the best card to use, it depends on the situation and your ability to handle credit.

If building your credit score and taking advantage of the rewards program is important to you, a credit card may be more beneficial. However, if you have spending issues, a debit card is the safer bet.

What BigPay is doing differently

If you’re on team debit, consider switching to BigPay. Your account comes with a Visa card that works just like a debit card.

But the biggest difference is you’ll earn points every time you spend, just like a credit card and without the risk!

Download the BigPay app on iOS or Android to sign up in as little as 5 minutes. It’s 100% free to get and free to keep.

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