For more than 50 years we can find in anyone’s wallet all kinds of cards with which to pay in stores. Undoubtedly, this progress was a real revolution that has allowed us to dispense with carrying bills and coins every time we leave home, with the risk that it entails.
However, not all cards are the same and, although the most heard concept is “credit card”, not all are exactly. Simply, the cards have been called that colloquially because the credit card was the first to be used.
So what types of cards are there?
The cards can be more original or simpler, with more or fewer colors, plastic or titanium … but what is really important when differentiating between the different types of bank cards is their operation or the transaction processing company.
Depending on the operation, the cards can be debit, credit or prepaid:
The debit cards are payment instruments linked to a bank account that have the available balance of it. In this way, depending on the available balance, each time you make a purchase with it, they are charged directly to your account.
As they depend on the available balance of your account, they will not allow payments that leave the account to which they are linked in red numbers, that is, a tacit overdraft operation subject to the bank, according to the conditions of the account, admitting the overdraft and deciding to advance amount needed to cover the difference.
Credit cards are also tied to a bank account. However, the purchases you make with them are not charged directly to your account but can be deferred and paid at another time by paying interest. These cards offer a credit independent of the available balance of your account.
However, deferring payments or exceeding the card limit, usually involves the payment of interest and additional commissions.
The prepaid cards are cash cards. So you must recharge them prior to use. Thus, they will only be able to spend the money that you have deposited in them before any payment, not allowing overdrafts of any kind.
These types of cards can be VISA Card, MasterCard or American Express depending on the companies that process the transactions that are made when using a credit card, debit or prepaid card. A payment processor is a service provided to the card issuing entity (such as banks) for the execution of payment operations.