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Card Services
ATM… Debit Card… Credit Cards – What is the difference?
With so many high-tech choices to manage your money, it helps to understand the difference with the plastic card you carry in order to access your funds. Knowing the difference will help you to keep a good record of your transactions and the satisfaction of being able to determine what items on your bank statement are correct.
An ATM card is a card issued usually to someone who just has a savings account. Although in certain instances a financial institution may issue an ATM card to a person who also has a checking account (this is determined based upon the need of the individual person). ATM cards are just that, a card to be used at an ATM machine (Automated Teller Machine) to access the funds you have deposited into your account. You can also use this card at an ATM to deposit funds into your account, check account balances and if applicable transfer funds from saving to checking or vise versa.
A DEBIT card is usually issued to a person who has opened a checking account. The person may, based upon personal choice and after talking it over with the financial institution, choose just to have an ATM card and use just their checks to access their checking. DEBIT cards are not only used like an ATM card, they are also used as an electronic check. This means you can do a point-of-sale (POS) to purchase items via a store, gas station, or other places where you normally would write a check or give the merchant cash for the purchases being made. You can also use ii for on-line internet shopping. Using your card is limited to the funds available in your account. When you use the card with your Personal Identification Number or (PIN), this allows the merchant to withdraw the funds from your checking account. These cards usually carry either the VISA or MASTERCARD logo’s and are sometimes confused as a credit card. Most have wording denoting they are a check card or debit card on the front.
A CREDIT CARD is a card used to access a line of credit granted to you by a financial institution based upon your creditability. These funds are not deposited to the financial institution by you, but are funds that have been allocated to you as a revolving line of credit and must be repaid based upon the terms of agreement between you and the financial institution. These cards will carry the VISA or MASTERCARD logos.
What are your responsibilities?
Depending on what type of account you open; all financial institutions have guidelines for the use and privileges granted to the carrier. Each card has specific guidelines based upon whether it is an ATM, DEBIT or CREDIT card. Normally there are daily limits placed upon how much money can be withdrawn at an ATM using an ATM or DEBIT card. In addition there may be a limit of how much you can spend doing POS (point of sale) transactions with your DEBIT card. These limits are placed by the issuing institution to help protect the liability of the member as well as the institution should the card or card number become lost or stolen. Remember to discuss what privileges your card carries when you open your account. Then take a few moments to read any materials regarding the guidelines of the financial institution for EFT (electronic funds transfer). Taking time to read this information will help you to better understand your rights and the rights of the institution should your card become lost or stolen. While, it may seem a lot of information is given to you when an account is opened, it is provided to help educate yourself regarding your responsibility in using this new and exciting technology.
Financial institutions have federal, state and local guidelines they must follow regarding the use of electronic funds transfers and are required to give you a copy of this information when an account is opened. Once they have complied, it then becomes your responsibility to review and understand your rights and the privileges of carrying an ATM, DEBIT or CREDIT CARD.
Keeping receipts from these transactions is good way of making sure that you keep track of your balance available and can help to determine where money is being spent in order to help create a budget and to save money for the future. The receipts also are useful when an item appears on your statement from your financial institution and you need to dispute the validity of the item.
ATM and DEBIT cards are great time saving tools and give you so much more flexibility, but with this comes more responsibility to protect your information, like your personal identification number or (PIN). Safeguard your (PIN) issued to you in connection with your card. Never write your (PIN) on your card and never carry it written down in your purse or wallet. If, you have the option of changing your (PIN), do not use information that may be available on your driver’s license or other identification you carry. Try to use a number that is only known to you, like a parent’s anniversary date or other sibling’s date of birth.
Today’s technology has brought us a long way from having to bank only Monday through Friday with limited hours, physically going to the bank to cash our checks, get enough money to last a weekend or be able to purchase items without a paper check. Access to our money is 24/7 and with this access we must take responsibility of knowing how to use it wisely. Therefore, knowing the differences regarding the type of card connected to your account and what privileges that comes with it will help you become a knowledgeable user in the Megabyte Money medium.
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