"ATM/Debit Card" submitted by SchoolGrantsfor Editorial Team and last updated on Tuesday 26th April 2011
A payment card that is linked directly to a customer's bank account. Some cards require a personal identification number. Others require a customer's signature. Typically linked to a checking or savings account, debit cards allow the user to immediately withdraw the funds.
Debit cards (sometimes called check cards) is a great thing about a checking account is that you can get a debit card linked to your account. Similar to checks, you can use your debit card to make purchases in stores and restaurants, but you also can make purchases at online retailers and get cash at ATMs.
They’re convenient and safe. Debit cards are convenient and safe because you don’t have to carry your checkbook or a lot of cash. Plus, you are typically required to enter your secret PIN (Personal Identification Number) or sign the receipt to use the card. (Depending on the dollar amount of the transaction, some merchants no longer require a signature.) When you first get a debit card, you choose a PIN that only you know. Avoid obvious number choices like your address, phone number or birth date. Keep your PIN a secret; don’t write it down or tell your friends. That way, no one can use it to get access to your cash except you.
When you’re asked to choose between debit or credit, remember that choosing debit means you’ll need to use your PIN number, while opting for credit generally requires a signature. Either way, the amount is deducted from your checking account.
Cautions about using debit cards and checks:
- You are responsible for the transactions you make and you must ensure that you have the funds to cover all expenses.
- To avoid becoming overdrawn on your account, you will need to keep track of all withdrawals and deposits. You can do this by using your online banking service or your check register.
- If you don’t keep track of your transactions, you could easily write a check for an amount that is more than you have in your account. If this happens, your check will not clear and you could incur costly overdraft fees from your bank.
- Things you buy may cost more than you expect, due to accumulated overdraft fees.
- Using your debit card will not keep you from becoming overdrawn on your account.