Credit vs. Debit

Both credit and debit cards are payment options, or alternatives to using cash or checks.

Credit cards are a form of credit that gives you the flexibility to finance purchases over time. Credit cardholders are not required to pay off the statement in full at the end of each month. Instead they pay as much as they choose (but no less than the minimum required) and the balance or amount left carries into the next month. Each cardholder has a maximum amount of credit available.

Debit cards, on the other hand, are limited by the balance in your bank account. When you make a purchase, the price is directly and immediately deducted from the cardholder's bank account. Purchases are then itemized on the cardholder's monthly bank statement. Credit and debit cards are subject to the terms and conditions of the account.