Why should you use your debit card as a credit?

person swiping card through machine with cashier in the backgroundYou’ve seen the pop-ups before, you’re swiping your card and it asks you, “debit or credit”, but what does that really mean? Contrary to popular belief, this is not asking what type of card you are using. Instead, it is asking if you want the transaction to be processed as a credit or debit transactions. So, what is the difference between the two?

This is an option that is only available for debit card owners. Credit cards are unable to be processed as anything other than credit because they are not connected to a bank account. Debit cards on the other hand are connected to a bank account, allowing payments to be processed either way. Why would you even want to process your debit card as a credit?

If you select credit on the screen when using your debit card, it will process your payment through your financial providers credit network, for Alltrust card holders that network is through MasterCard®. This means that the transaction will be process offline instead of in real time, which can take 2-3 days to complete. This adds many of the protections credit cards have to this transaction. You will not have to enter your pin number at the register, your card will not be processed immediately, and if your card processor has zero-liability policies it will carry over to help protect you from unauthorized payments.

However, processing your debit card as credit does not give you all the benefits of a credit card. You cannot build your credit score by processing you debit card as credit because it is not actually using credit to pay for the purchases. You also cannot use funds you do not currently have in your account. However, if you have overdraft protection you are allowed to withdraw a specified amount that needs to be paid back later and typically incurs a fee to use.

Processing your debit card as a credit card still provides you with the benefits you expect from a debit card. These include but are not limited to:

  • Easy money management
  • Using the card at your ATM to withdraw funds
  • Easily transfer funds when needed
  • And more

This makes it a no-brainer to use your debit card as credit to get all your debit card benefits and more. The benefits of the added security when using your debit card is the most important reason to process your debit card as credit when you can. If you are having difficulty using your debit card as credit, ask the cashier for assistance; they have the ability to help you process the card as credit.

If you look for any other ways to help protect your financial information and yourself from fraud read our “Protecting yourself from Fraud” article.

Have a financial question, email media@alltrustcu.com and it might be our next blog post!