We will be closed on Wednesday, June 19 in observance of Juneteenth. Bank Holidays

Understanding the Differences Between Credit Cards and Debit Cards

Understanding the Differences Between Credit Cards and Debit Cards

In the world of banking, credit cards and debit cards are everyday tools for managing your money. But what sets them apart? Let's explore the key differences between credit and debit cards to help you make smarter financial choices.

How They Work:

Credit Cards: Borrow money up to a predetermined limit and pay it back later.

Debit Cards: Use the money you already have in your bank account that is linked to the card.

Spending Limits:

Credit Cards: Have a credit limit set by the card issuer, which is the maximum amount you can spend.

Debit Cards: Your spending is limited to what's in your account that is connected to the card.

Fees and Charges:

Credit Cards: May incur fees and interest if you don't pay on time.

Debit Cards: Risk overdraft fees if you spend more than your balance.

Building Credit:

Credit Cards: Can help build a positive credit history with responsible use.

Debit Cards: Transactions don’t impact your credit score.

Interest Rates:

Credit Cards: Charged interest on unpaid balances.

Debit Cards: No interest since you spend what you have.

In Conclusion:

Knowing the differences between credit and debit cards empowers you to make wiser financial decisions. Whether you're looking to build credit or stick to a budget, understanding how these cards work will guide you towards financial success. We have both debit and credit card options to fit your lifestyle! For specific details on our credit and debit cards give us a call, stop in to any First Citizens location, or view the links below. 

Personal Debit Cards  Business Debit Cards

Personal Credit Cards  Business Credit Cards

Banzai Financial Education