Does it make a difference when you pay if you use credit or debit on your debit card?
There is a world of difference - which is the timing when you actually pay for the goods. For a credit card, you are actually borrowing money made available from a bank. When you swipe your card, your credit limit given by the bank decreases and the bank in turn pays the amount of money to the merchant when they make a claim. At the end of each billing cycle, the bank bills you the total amount you have “swiped” to be paid in a certain number of days. (i.e. 21 days) You may end up paying more in interest if you do not settle the full outstanding balance due to the bank in the stipulated time given. A debit card on the other hand works exactly like a credit card, except that it is normally tied to your savings account and the amount you “swiped” will immediately be on hold by the bank until the merchant makes a claim for it with your signed sales receipt. The beauty of this prevents you from spending more than what you have in your savings. You will also receive a monthly statement for your debit card expenditure - the only difference this time is you do not have to pay for it.