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Why You Should Use Your Debit Card Like A Credit Card

Updated on November 15, 2013

You may have noticed that your debit card gives you the option to use it as a debit card or a credit card. Some banks will tell you to only use it as a credit card, here is the reason.

What is the difference?

Most debit cards are issued by Visa. If you use it like a credit card, signing your name instead of punching in your pin number, your purchases are insured and your transaction is safe.

Visa will insure all of your purchasing. If your card is stolen and you call right away they won’t hold you responsible for anything the thief buys with your credit card or debit card. That’s part of what all those fees cover.

If you use your card like a debit card, using a pin number instead of signing, then it is like you wrote a check or just drew money out of an ATM (automated teller machine) and you are responsible for any problems that may arise.

Will I be charged interest or extra fees?

No. At least you shouldn’t be. Talk to your bank representative if you need clarification about this.

A while back the United States government made changes and passed regulations so that credit card companies and banks couldn’t overcharge people. They had a system that enabled its customers to use their card, within reason, even if they didn’t have money in their account. The problem was, people were racking up bank charges and fees like crazy mounting up large sums of debt.

Some customers had so many bank fees by the time they got paid they were still broke and on top of it they owed the bank money.

Now you have to sign a contract allowing them to give you overdraft protection. It sounds harmless and wonderful but it isn’t. It’s a terrible bad idea and no one should ever sign up for this because when you do they of course charge you for this privilege. You should, instead, learn to live within your means but that’s another story.

Banks now have to have your permission for any extra service charges above and beyond the usual fees.

How do you use your debit card like a credit card?

Stores don’t want you to use your card as a credit because they get charged a fee. This fee is what funds your transaction insurance.

When you slide your card on those machines if it comes up with a keypad wanting your pin number just hit cancel. It will then role over to a signature pad for credit. Some are different and will ask credit or debit or the clerk might ask you. Always say credit.

Some stores have a limit and if it is under a certain amount you won’t have to sign or use a pin number. Don’t worry it’s still insured.

Credit card stigma

I’ve known some people that didn’t want to use their debit card as a credit because they didn’t want people to think they couldn’t afford their purchases and had to charge them. This is not true and in fact many rich people only use credit cards for all of their purchases so they have less bills at the end of their billing cycle. They just transfer one amount of money for their total transactions that month and they’re done.

This is a carry over from before debit cards and it just made their lives easier not having to fill out and sign a check for each transaction plus that insurance I mentioned above.

No more checks

You almost never see anyone writing checks anymore. I recently saw two different women doing it, one looked to be in her 80’s and the other in her 50’s.

Writing checks holds up lines, many small retailers won’t even take them anymore and it takes up more space in your purse or pocket.

I still have checks for paying those few bills that don't have bill pay online (I live in a rural community), school related costs (I don't trust the school to keep up with cash) or the rare occasion I've ran into people that won't or can't take a card and want a check.

The only disadvantage I’ve found with debit cards is that you don’t have a ledger to keep track of your spending. You can go online but that won’t show all recent transactions especially if it’s a small local establishment.

My husband is a budget analyst and more organized than most. He keeps all of his receipts in his wallet and when he gets home he posts them to a spreadsheet he has on his computer. Many of his purchases are related to our rental property so we have to keep track.

You don’t have to be quite that organized unless you make a lot of purchases and have trouble keeping up with everything you’ve bought. As long as you have a pretty close idea of how much money you have in your account at all times you will be fine.

Don’t store your credit cards or debit cards next to your cell phone

The magnets in our cell phone will demagnetize our credit or debit cards.

I had to replace two debit cards before I realized what was happening. A store clerk asked me if I keep my cards near my cell phone.

“Sometimes. When I go out and carry a small purse I just carry my phone, driver’s license and one or two cards.”

She said that was probably why my card wouldn’t scan.

Our new driver’s license has chips in them too so I’m wondering if that can be demagnetized as well? Just in case I no longer let my cell phone near any of my cards. It’s why they send our cards in those little protective sleeves I never used to keep. I keep them now.


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    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      5 years ago from Oklahoma

      I didn't either, Espresso but I'm careful now to not let any of my cards (even my driver's license) near my cell phone.

    • Express10 profile image

      H C Palting 

      5 years ago from East Coast

      These are useful tips. I didn't know about the possibility of cell phones affecting the magnetized credit card strips.

    • joym7 profile image


      5 years ago from United States

      Great tips. I always use my debit card to purchase things online or offline.

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      5 years ago from Oklahoma

      Good to know, tsmog. PayPal is becoming a bigger company and offering more and more services. I'm not familiar with a co-tender card.

      Tales, just because you choose credit doesn't mean you are in debt and depending on the arrangements you've made with your bank you may not be able to use it unless you have funds to cover it.

    • lupine profile image


      5 years ago from Southern California (USA)

      I've been wondering what the difference was, thanks.

    • samadaslam profile image

      Samad Aslam Khan 

      5 years ago

      Great useful Hub Pamela like always, that's why I follow you. Well about this hub, So got some useful shopping ideas. I already use my debit cards and never used Credit Card for shopping to avoid interest and other such charges. It's safe actually and more secure as well.

    • TalesofTikitumtum profile image

      Isabel Gray 

      5 years ago from East Coast

      Hi, Pamela-- Your case for using debit cards as credit was nicely explained and cleared up the conflicting answers I have received from other sources (banks, retailers, friends, and--oh my goodness--older family members, to whom "credit" means I surely am in serious debt (laugh--about their interpretation, I mean, and certainly not about anyone being in debt, myself incuded, perish the thought). Thank you very much for this very helpful information.

    • tsmog profile image

      Tim Mitchell 

      5 years ago from Escondido, CA

      A lot of great information. Yet, what of Mastercard issued co-tender cards. Are they the same? I will look further because this article has caused awareness. Just a note. You can use Pay-Pal at home depot now, or at least in this area - San Diego. Not sure if being test marketed or nationwide. (A quick glance I see it is nationwide introduced in Feb) I would think, though not sure, Pay-Pal will insure the purchase as they do their online purchases.

    • Ruby H Rose profile image

      Maree Michael Martin 

      5 years ago from Northwest Washington on an Island

      Perfect timing for such a wonderful hub. I didn't know the difference of using a debit card as credit. I will for sure tell clerks credit from now on. Thanks for some insight to keep better track of my spending, it is so easy to get carried away during the holidays.

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      5 years ago from Oklahoma

      I've only had debit cards issued by Visa and they are safe if you use them like a credit card. Some day checks will no longer be around and you can't pay cash online unless you use paypal which takes money directly from your bank account.

    • writinglover profile image


      5 years ago from Lost...In Video Games

      This was a refreshing hub. My parents had always warned me about using debit cards and this reinforced their warnings. My eldest sister had a debit card that wasn't from Visa and she got double dipped by the company that she was paying to. This was years ago, but still. Thumbs up!

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      5 years ago from Oklahoma

      I have a couple major credit cards and a debit card. Traveling and renting cars is easier when you have them. As long as we are responsible with them they are good tools.

    • prasonline profile image

      Prasanna Marlin 

      5 years ago from Sri lanka

      Thanks for the information. both good and bad. Unfortunately, I don't have any credit card. I wasn't comfortable using this card. Well done, my friend.

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      That is right, Monica. Some banks will charge you the fee if you use your card as a debit purchase so watch out for that.

    • monicamelendez profile image


      6 years ago from Salt Lake City

      I had no idea that the credit card fee charged to businesses covered purchase insurance. No more debit for me!

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      Frogyfish, a debit card takes money from your checking account. It's different than a credit card. Be careful with credit cards and debit cards near your cell phone because they will demagnetize them.

    • frogyfish profile image


      6 years ago from Central United States of America

      I use my debit (credit type) card and pay it off each month, so that is right on...But I never thought about the cell phone effect on the magnet info strip. Thanks for this great info.

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      B. Malin, my in-laws were in the banking business so I learn quite a bit from them.

    • b. Malin profile image

      b. Malin 

      6 years ago

      Excellent Hub Pamela. As much as we think we know, your Hub proved to me, there was still much to learn about using my Debit Card as a Credit Card. Thanks for all the Timely Information...Loved reading all the Comments.

      I now look forward to Following your Hubs.

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      AK, that is why people should keep their own records as well as checking online. Thanks for reading.

    • AKqueencrab profile image


      6 years ago from Juneau, Alaska, USA

      This was very informative, I never thought about the insurance. I understand what Don Simkovich was referring to though. When you use your debit card with your PIN, you see the transaction immediately in your online banking. When you use it as a credit card you don't always see it right away, sometimes two or three days. And it wont "hard post" until the vendor submits their credit card batch. If you are very organized ie. using your check register or a spreadsheet, it wouldn't matter. But if you are swiping away and not keeping track, those delayed transactions could overdraft you if you aren't careful. Great article!

    • Smireles profile image

      Sandra Mireles 

      6 years ago from Texas

      Useful and informative article. Thanks.

    • Au fait profile image

      C E Clark 

      6 years ago from North Texas

      Yes, my debit card is issued by Visa. Have been using it as a credit card for at least 10 years now.

      I do agree that making purchases with a credit card is safer in the long run, which I put in my recent hub about making purchases over the Internet. Credit card companies, at least the big three -- Visa, MasterCard, and Discover, will make sure any company that accepts their card is credible and does business with integrity.

      If I have a problem in the future with my debit card, I will take your advice and contact someone at Visa. Agree that bank personnel do not always know what they're talking about. Have had that issue before, too. ;)

    • alipuckett profile image


      6 years ago

      I noticed quite some time ago that I could use my debit card as credit, and I've always wondered exactly what the difference was. Now I know! What a great hub! Voting up and useful!

    • profile image


      6 years ago

      very nice hub!!

    • prasetio30 profile image


      6 years ago from malang-indonesia

      Very inspiring hub, Pamela. I love to use debit card than credit card. Useful tips from you. Thanks for share with us. Rated up and awesome!


    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      Au fait, is your debit card issued by Visa? If so Visa should cover any problems. Your bank representative should have told you that. Not all bank tellers are up on financial information. I'd call the people who issued your card or someone higher up in the bank.

      When traveling it is much safer to use a credit card and then pay it off when you get back by transferring funds from your checking account.

    • Au fait profile image

      C E Clark 

      6 years ago from North Texas

      Always use my debit card as a credit card because I don't want to have to remember the PIN along with all the other PINS and passwords etc., that I have in my life. However, on a couple of occasions when there were problems with the company I made a purchase from, my bank told me I would have to work out any problems with the company I had made the purchase from myself. NO INSURANCE.

      So, that insurance you talk about would seem to vary from place to place and bank to bank. Personally, I recommend using a credit card whenever possible, because credit card companies do insure your purchases and they do go to bat for you if necessary, whether your purchase is in person, online, or over the phone. With a credit card you have 30 days from the time a purchase appears on your invoice to challenge that charge for any reason.

    • jainismus profile image

      Mahaveer Sanglikar 

      6 years ago from Pune, India

      Great Hub, thank you for sharing the information, tips and suggestions. Voted up and shared.

    • one2get2no profile image

      Philip Cooper 

      6 years ago from Olney

      I didn't know that at all. Very interesting information. Thank you. Voted up!

    • profile image

      Emerald Strachan 

      6 years ago

      I have a US prepaid debit card issued by Metabank. I only use the card like a credit card because the PIN transactions are much more expensive than signatures purchases. I didn't know about the insurance.

    • breakfastpop profile image


      6 years ago

      Thanks so much for this information. I had no idea that there was a difference in how I use my debit card. I will never enter my pin again thanks to you.

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      Kashmir, I try to tell everyone I know about the cell phone/card dilemma.

      Incomeguru, this is about a debit card, not a credit card. When used properly, credit cards are very useful.

    • incomeguru profile image

      Oyewole Folarin 

      6 years ago from Lagos

      Very useful information. But those that really wanted to save money on a tight budget should avoid the use of credit card.

    • kashmir56 profile image

      Thomas Silvia 

      6 years ago from Massachusetts

      Lots of very valuable information within this well written hub,thanks for the tip about putting your cell phone near your debit or Credit Card.

      Vote up and more !!!

    • phoenix2327 profile image

      Zulma Burgos-Dudgeon 

      6 years ago from United Kingdom

      A very informative and useful hub. I can't really comment as things work a bit differently here in the UK.

      Voted up, useful and interesting.

    • teaches12345 profile image

      Dianna Mendez 

      6 years ago

      Interesting information. I didn't know about the cell phone and card interference. I will have to make sure to keep them separate. Thanks for sharing such valuable informaton. Voted up.

    • writer20 profile image

      Joyce Haragsim 

      6 years ago from Southern Nevada

      My husband is the same as yours. I always write my debit purchases on to my check book register, so that I can stay current.

      voted up, useful and interesting, Joyce. Have a great weekend.

    • point2make profile image


      6 years ago

      Excellent information....thanks. I never thought about using my debit card that way. It certainly makes sense and I will try it tomorrow. Your hub was very informative and well presented....well done! Voted this hub up.

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      Banks, the extended warranty and replacement coverage applies. Not sure about the rental car or hotel question, that would be a good one to ask your bank representative. When we travel we always use our credit card instead of our debit card due to gaining frequent flyer mileage and other perks.

    • Brandym2012 profile image


      6 years ago from PA

      Thank you for sharing! I found this hub interesting & helpful.

    • bankscottage profile image


      6 years ago from Pennsylvania

      Interesting Hub. I think using a debit card as a credit card (signing rather than PIN) is a good idea. But, I thought there were a couple of issues when using your debit card rather than a credit card.

      Some charge cards offer an extended warranty on purchases or replacement coverage if the item is lost, damaged, etc. within a certain period of time.

      Some charge cards will cover the deductables and insurance on rental cars. Does the debit card cover these also when you sign like a charge card?

      Finally, when I check into a hotel and they ask for a card to cover incidentals and the cost of the room, they warn that using a debit card could tie up more funds than the cost of the room and tie them up for several days putting you at risk of overdrawing your checking account. Does signing rather than a PIN change this issue?

      Thanks for the good info. voted up and useful.

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      HWM, yes money will be pulled out at the same amount of time no matter which method you use. Small businesses sometimes don't have an automated system that might take a day or two but whether you use debit or credit it will happen at the same rate.

      Thanks, Spirit Whisperer.

    • Spirit Whisperer profile image

      Xavier Nathan 

      6 years ago from Isle of Man

      This is a very informative and useful article that everyone should read and many will get a lot from. Thank you.

    • healthwealthmusic profile image

      Ruth R. Martin 

      6 years ago from Everywhere Online ~ Fingerlakes ~ Upstate New York

      Thank you for giving me a better idea on how this all works. Because I was unsure of how it worked, I always have used the debit option. My husband has at times used the credit option at a gas station to pay at the pump.

      So if I understand this correctly, does the money get pulled out of your account immediately when you use your card as credit, same as when you use it as debit?

    • Pamela N Red profile imageAUTHOR

      Pamela N Red 

      6 years ago from Oklahoma

      Don, your bank statement should look the same regardless if you use it as a credit or debit. Not sure what she means.

    • Don Simkovich profile image

      Don Simkovich 

      6 years ago from Pasadena, CA

      Okay, interesting hub. My wife really doesn't like me to use my debit card as a credit card because she said it makes the accounting portion more confusing. Maybe she means she can't track expenses well. Nice to see this hub on a topic she and I have discussed.


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