Credit Card vs Debit Card vs Prepaid Card: Select The Right Card For You

Credit Card vs Debit Card vs Prepaid Card: Select The Right Card For You

There are mainly three types of card that people usually carry in their wallet. These three cards have a common thing within them. You may differentiate these cards with their logo. These logos are of major credit card companies as follows: Visa, Master Card and American Express. Cards are categorized into 3 modes through which you can do payments. Debit, Credit and Prepaid Debit Card (example: Myprepaidcenter). While making a payment with card, we get confused that what is the purpose of this and what makes it different from others. So, here is all the information that explains the use and value of each card.

Credit Card vs Debit Card vs Prepaid Card: What’s the Difference?

Debit Card

In simple words, Debit card does transactions involving your balance in the current bank account. You can use your Debit card in multiple ways. Either you can withdraw cash from your card through an ATM or could use your card to make online payments. You can use your debit card to make purchases in-store. As soon as the transaction happens, the amount will be debited from your bank at that time only. The transaction will immediately reflect in your bank balance. If you try to do any payment that exceeds your bank balance, it will decline the transaction.

Credit Card

Everyone is familiar with Credit Cards. Who came first?? Egg or Chicken?? Nobody knows but surely we know that Credit Card came first. It is the oldest of three cards. It came in the 1950s. As the name says “Credit”, it involves giving credit to the issuer or card user.

This card extends the line or limit of payments you can do even after having less account balance. In another way, we can say that if you have $50 in your account but you want to make a purchase of $80, this card will help you out.

There are certain factors that make you eligible for issuing a credit card. If conditions such as your credit score, credit history, repayment history, Gross annual income and number of credit cards under your name are met with the company’s terms & conditions then you’ll be eligible to apply for a credit card.

If you try to make a payment that exceeds your credit limit, it would be denied. But, there are some options that may enable you to exceed the credit limit. It may not be a huge difference in numbers.

Credit Card companies charge interest from the issuer. Let it be the billing balance, you’ll be charged interest on your unpaid balance. Rate of interest may differ daily. Usually, it increases day by day as it compounds your interest.

Prepaid Debit Card

Prepaid is simply a kind of gift card that is usually called a Prepaid Debit Card. It can be used to make respective purchases or the amount can be transferred to the debit card and can be withdrawn. As Debit Card is directly linked to the bank, a prepaid card does not have any link to the bank.

In the prepaid card, just like a credit card, overspending is not an option. The amount that you put in the prepaid card is what you can use. So, that’s a benefit for prepaid card users.

So, these are the three cards that are the modes of payment nowadays. You can wisely choose your card according to your financial condition or you can enjoy all the cards on your own will.

Which Is The Right Choice For You? 

Benefits of Credit Card: There are certain benefits of carrying a credit card. You can avoid fraud transactions. If you get alert regarding the unauthorized transaction that you didn’t do, you can report it to the credit card company. They won’t charge you for the fraud transaction, instead, they’ll investigate the theft identity. You can gather bonuses or points after every purchase you make through your credit card. More the transactions or purchases more will be your points. You may also get cashback sometimes.

Benefits of Debit Card: The biggest benefit of using a debit card is to withdraw cash whenever you want from your through a nearby ATM or else of making online payments or to make purchases in-store. The amount directly gets debited from your bank account after making payment through card.

Benefits of Prepaid Card: Prepaid card is a good solution for those who are not eligible for credit cards. You may have several charges in prepaid card such as transaction fees for certain transactions, balance inquiry fees, monthly service fees, ATM withdrawal fees, inactivity fees, etc.


With the help of this article, we tried our best to give you the perfect solution to your question. Overall, every card has its own benefits so we can’t pick one. However, you are the ultimate decision-maker so it’s up to you to choose the right one that can fulfil your need. So, choose the best and the benefit of your selected card.

David Hood

David Hood is a professional author. He has since forayed into mystery, crime, and more topical genres, as well as screenwriting. His writing style, which takes liberties with proper grammar in exchange for flow, is also unique. And now he is onboard with US Times Now as a freelance writer.
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