What is the difference between a credit and a debit card?

>Initiate CRAB-16

Right. Okay thanks. Banks can approve the overdraft without locking your card though. So the difference actually is just the fees and nothing else? It seems like its just semantics. A credit card was designed to be constantly in the negative amount, while a debit card was designed to be constantly in the positive amount. But you can be negative and positive on both accounts.

What about the difference between a prepaid card and a debit card? Debit card is backed by an actual bank account, while a prepaid card is its own account? Seems like again just semantics.

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Take a look@ coinmarketcap.com/currencies/ethgas/

Get the fuck outta my thread with your monopoly money. Adults are talking.

fees aren't semantics

It's not semantics, they're different things.

Credit card - a bank is telling you that they trust you enough to have a credit line of $5k to use. You use the card to buy stuff, which you now owe the bank. If you pay it by the end of the next statement (usually a month), there's no interest on the "loan" and your credit line goes back up to $5k. If you don't pay the amount due from the statement, the bank will start charging you interest (usually crazy high like 20+%). This sounds like a shitty system. It is. People still use credit cards because you get rewards, perks like free checked bags, build your credit (important for loans, apartments, cars, etc), and it gives you time to pay stuff off. If you only get paid monthly, a credit card is better because you're able to buy stuff before your paycheck comes in, and then you just pay the credit card off then.

A debit card literally just takes money out of your bank account. You can only spend what's in it. If you go over, you get an overdraft fee, your account locked, and sometimes the bank will just close your account. It doesn't build your credit score, you don't get rewards (there are some that do but it's not super common as far as I know), and if you don't have the money, you can't buy whatever you're trying to. If your groceries are $50 and you have $30 tough shit looks like you need to put the stuff back.

A prepaid card doesn't have a bank behind it, as much as I understand. You're buying it right from the credit card company (visa, Amex, etc). It's basically the equivalent of a gift card to the credit card company. Once it's empty, some can be refilled, but most are disposable. They have limits on how much you can put on them, and you can't transfer value. To buy stuff online, you have to register it with your name, address, and SSN to avoid terrorist purchases. So good luck trying to live off the grid with prepaid visa cards. You also generally can't turn the prepaid back to cash/no atms.

Credit and Debit are accounting terms.

Credits increase liability accounts, Debits increase asset accounts. Debits decrease liabilities, credits decrease assets. From the bank's perspective, your checking account is a liability, so when you draw from it, bank liabilities fall and thus are debited. When you use a credit card, the total liabilities of the credit card company are increased, so we call it a credit.

SILENCE!

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Take a look@ coinmarketcap.com/currencies/ethgas/

Have you heard of Google you stupid fucking faggot?

Thank you user. This is a much better explanation than anything i found on google. You're awesome.

No problem m8. This stuff can be confusing, especially since it's not taught in schools here in the US. If you are just starting out growing your credit score, I'd recommend the Discover It card. Most people get approved for it with not much credit history.

At first, your credit line is going to be super low, like maybe a couple hundred dollars - this is dictated by your income. Just use it, don't buy shit you can't afford, and always pay it off on time. Save the reward points for a bday gift for your mom or something. Makes you feel good and you didn't actually spend money on it. Double win. Feel free to ask more questions if you want.

Op, the fact that you are asking this question tells me the education system is really failing. I hope for all our sakes that you are 13 years old or live on a island in the S. Pacific.

Credit = you owe the bank
Debit = Bank owes you

The education system has failed us. It's a system designed to teach kids to pass an exam by seeing keywords and regurgitating passages learned off by rote. Even theorems are taught in this manner, there's no need to question anything or understand when all you have to do is vomit unoriginal half taught buzzwords onto a page.