Why do you need to choose (or tell the worker) “credit” or “debit” when paying for something by card? Are the two cards built differently?
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It’s sometimes a matter of whatever POS is being used. Cashier needs to tell system the payment method for the sale to be completed. Currently I push the “credit card” button and the pin pad does the rest …asking the customer to put a pin (debit card) or if it’s a plain credit card it just processes and completes.
It’s a choice of which processing network to run the card under. I’ve seen a few cards that charge a fee for transactions presented one way or the other, but many card terminals just make an assumption based on the card presented.
Because it works differently, and hook up to different network – even if they are from the same bank
Credit card basically pre-authorize you to use X amount of money. However, within a certain time period, you must pay them back. or ELI5: You are doing a loan – borrowing money
Debit card draw from either the stored amount, or more commonly, from your bank account. No money in there, no use.
Some of the older machines cannot tell the difference, and thus require manually let it know whether you are using debit or credit.
Every bank I’ve ever used all local charge for debit. Do the big banks not?
Credit is just an authorization, debit pulls the fund immediately. This works best when doing things between use and payment required, such as renting a car
In the US, debit cards from banks are often administered by a card processing network (Visa or MasterCard). Selecting “debit” means the payment terminal will act as an ATM and withdraw the money immediately using the bank’s ATM network. Selecting “credit” means the payment terminal will submit the request using the Visa/MasterCard network. Using the Visa/MasterCard network often adds a layer of security but (I think) takes longer for the transaction to clear. So it may sit as “pending” for a day or two. Using the ATM network is a bit riskier (it’s accessing your bank account directly, which is why you need to enter your ATM PIN), but the transaction clears immediately and you have the option of getting cash back.
No idea how accurate this actually is, but I worked at convenience store for a year, and my GM basically said to me to think of it in transaction fees, since using debit often comes with something like a 25 cent transaction fee for the consumer, while credit, the store ends up paying a transaction fee.
Have never used “debit” a single time since then
Credit – you borrow money from the bank to pay. You pay the bank later, and you get whopping interest/penalties if you don’t.
Debit – your savings account gets deducted immediately by the amount of your purchase.
The worker needs to know as these two are handled differently on the card terminal.
Some [small] businesses are charged a percentage of the purchase by the bank/financial institution to process the transaction. Debit card fees “tend” to be lower, but businesses like to make a profit so they sometimes post a minimum amount for non-cash transactions
I have asked more than once, which do you prefer? The answer is usually based on the amount.
Hi OP What Country are you in?
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