Debit and Credit Cards

A debit card is a card provided by your bank that is associated with your current account. Debit cards are used to provide simple access to the funds in your bank account, and can be used to make purchases in stores that provide card purchase services, withdraw money from your bank account via Automatic Teller Machines or over the counter in a bank, or make purchases over the telephone by mail or on the Internet.

There are a number of types of debit card, and the specific type will determine what services you have access to.

Solo

Solo cards are most often given to people under the age of 16 as they only provide a very limited range of services, as well as a maximum purchase limit. As such their use is limited to certain types of transactions

Delta & Switch

Delta & Switch cards allow access to a wider range of financial services, and allow you to make electronic purchases in stores, over the internet, via mail order or over the phone that draws funds directly from your current account. Delta & Switch cards are more flexible than Solo cards, and do not place any limits on the amount of money you can spend, as long as you have the funds in your current account. They often have daily limits for cash withdrawls from ATMs, generally in the range of £200-£300.

Credit Cards

A credit card agreement is a fixed loan provided to you at a higher than normal rate of interest that is immediately available in whole or in part through the use of the associated credit card.

The bank will guarantee to pay for any purchases made using the credit card, and in return you agree to pay the outstanding balance on the credit card or an agreed monthly minimum repayment.

You can often also obtain cash advances against a credit card. These cash advances generally attract additional charges for the convenience they provide, and often the cash advance portion of your outstanding credit card bill will be charged at a higher rate of interest than the purchase of goods or services.

Most credit cards are also associated with a financial service provider such as Visa or MasterCard that allows access to additional services, such as payment for purchases in stores, via mail order, over the telephone, via the internet or in other countries.