Looking at debit and credit cards side-by-side it is hard to see any real, physical difference between the two. They are both plastic rectangles, embossed with a series of numbers, and are acceptable tender in most shops, restaurants and hotels in Britain, as well as around the world. It is likely that you were first given a debit card as a teenager; a credit card following later as a more ‘adult’ way of handling money.
However, debit cards offer access to money that you already have, whilst credit cards provide money that you need to pay back, usually a minimum amount every month, plus interest accrued. Debit cards are therefore restricted by the state of your current account; if you do not have the money you cannot purchase something unless you wish to incur overdraft interest charges, or even be penalised for going over your limit. In some ways, this is a ‘traditional’ way of managing money – put simply; you cannot spend what you do not have. In fact, many people from older generations find credit an often alien concept.