Can You Use a Debit Card As a Credit Card At Checkout?

Last updated 03/15/2024 by

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Summary:

Though you can use a debit card as credit, this doesn’t mean your debit is a credit card. Instead, it merely affects how quickly your payment is processed. As long as you manage your debit card wisely and don’t overspend, using your debit card as credit at checkout could help keep your PIN safe from fraud and protect the funds in your checking account.

Have you ever wondered why you’re asked to choose between credit and debit when you insert your debit card into the payment machine at checkout? Most people find themselves at a loss when it comes to deciding which one to choose, and not many understand the difference between them.

In this article, we’ll look further into what credit and debit mean in terms of transactions, and answer the question of whether you could use your debit card as a credit card at the payment terminal.

Can you use your debit card as a credit card?

Yes, you can run a debit card as credit when you’re at the payment terminal. However, this doesn’t mean your debit card is actually a credit card, and you can spend funds you don’t have.

Running your debit card as credit simply delays the transaction for a few days until the merchant’s credit card processor successfully verifies the payment. So instead of withdrawing funds immediately, a credit transaction means that there will be a lag between when you make a purchase and when the funds leave your checking account. In other words, the transaction won’t happen in real-time as it would when you choose the debit option.

Once the payment is approved, the funds will be deducted from your checking account. So if you only have $50 in your bank account but attempt to spend $100 by running your debit card as credit, you risk hefty overdraft fees.

How is this different from using your debit card as debit?

When you choose debit at the payment terminal, money for the purchase is taken directly from your checking account. To verify your identity, you’re typically asked to provide your PIN (personal identification number) when making purchases with a debit card.

If the PIN you entered is correct and you have sufficient funds in your checking account, your payment will be approved. The purchase amount will then be deducted from your account balance immediately instead of days later.

Can you build credit with a debit card?

Unfortunately, no, you can’t build credit with a debit card. While debit cards withdraw money directly from your checking account, credit card purchases borrow against a credit line, which you must repay later. For this reason, using a debit card doesn’t indicate responsible financial behavior in the eyes of credit bureaus and cannot help build your credit history.

If you’re looking to boost your credit score, check out our review of the best credit cards to build credit or the best secured credit cards to build credit. You can also use the tool below to compare secured cards and find the best one for you.

Should you choose debit or credit?

It’s up to you whether you want to choose the credit or debit option at checking when making debit card purchases.

If you use debit cards as a budgeting tool, choosing debit at checkout allows you to track your spending easier since the funds are deducted from your bank account as soon as you insert your card into the payment machine. When you leave the store and check your account, you’ll see an updated balance that takes into account the money you spent earlier.

On the other hand, choosing credit at the payment terminal delays the transaction process for a few days. But once the transaction is verified, funds will still be deducted from your checking account. The main advantage of choosing credit at checkout is that you won’t have to enter your PIN. If you’re unsure about entering your PIN in a crowded store, opting for the credit option could offer you peace of mind.

Debit card pros and cons

Debit cards offer a secure and convenient way to pay for things without having to carry cash. But like any financial tool, there are pros and cons you need to consider.

WEIGH THE RISKS AND BENEFITS

Here is a list of the benefits and drawbacks to consider.

Pros

Convenience. You can quickly and easily pay for items with a debit card without having to carry cash or write checks. It also helps you avoid carrying large sums of money, which could be risky.
Accepted almost everywhere. Most shops, restaurants, gas stations, online shops, and other establishments accept debit cards as payment.
Using your own money. With debit cards, you don’t have to worry about accruing debt or paying interest as you do with credit cards because you’re using the available funds already in your checking account. This means you also don’t need to worry about reaching a credit limit.
Can help with budgeting. Another advantage of using a debit card over cash for purchases is that it helps with budgeting and tracking expenses. By checking your bank statements, you can easily see every purchase made with your debit card.

Cons

Limited protection. Debit cards don’t offer the same level of fraud protection as credit cards. This means that the risk for fraudulent purchases is higher with debit than with credit. Nearly all top credit cards offer zero fraud liability on unauthorized charges, whereas debit cards don’t offer the same protection.
Overdraft fees. With a debit card, if you have insufficient funds in your account to cover a purchase, your transaction will be declined which could result in hefty overdraft fees from the bank.
Lack of rewards. While most credit cards come with rewards programs such as cashback or points for every dollar spent, debit cards typically don’t have the same reward structure.
Can’t build credit. One of the main disadvantages of using a debit card is that it doesn’t help build your credit. Since you’re using your own funds with a debit card, you can’t demonstrate responsible spending and borrowing habits. This could impact your ability to get approved for loans in the future.

If your main concern about using a debit card is the potential overdraft fees, you may want to consider opening a checking account with no overdraft fees, like those below.

How to manage your debit card wisely

Purchasing items with a debit card may seem like a convenient way to spend your own money without going into debt. However, it’s still important to be mindful of how you manage this financial tool.

Use secure websites. When using your debit card to make purchases online, always check that the website is secure and has a padlock symbol next to the site name to avoid falling victim to potential cyber theft or fraud. If possible, try to use your credit card for purchases online since they typically offer greater fraud protection.
Check your account balance regularly. Make sure to review your bank statements on a regular basis to ensure there aren’t any unauthorized charges or suspicious activity.
Hide keypad when entering PIN. Whenever you enter your personal identification number (PIN) at an ATM machine or store register, hide the keypad. This way, other people near you can’t view what numbers you press, making it harder to steal them.
Be aware of the transaction fees. Sean Gilbert, a chartered financial planner and founder of Select Wealth Managers says, “There is a multitude of different transaction fees that can occur when you own a debit card. And although these fees are typically minute and nowhere near what credit card fees can be, it’s a good idea to become familiar with your particular bank’s fees to help you save on unnecessary charges.”
Know daily withdrawal limits. Debit cards typically come with daily withdrawal limits, so it’s important to know how much money you can take out each day from ATMs as well as in-store transactions.

Pro Tip

Make sure to set up alerts through your bank’s mobile app so you’re notified when a new transaction is made with your debit card.

FAQs

Is it safe to use a debit card as a credit card?

Yes, it’s safe to use a debit card as credit. As long as you know how much money is left in your checking account and don’t overspend, you shouldn’t have problems with overdraft fees or negative account balances.

Plus, when you use a debit card as credit at checkout, you won’t have to enter your PIN. So, if you worry about your PIN getting compromised, selecting credit instead of debit when paying for items could be a good way to protect your bank account.

Can you use a debit card as a credit card online?

Yes, you can use a debit card as credit online. However, when you’re paying for things online, you typically won’t be asked to choose between debit or credit. Instead, simply select the “pay with credit card” option and enter your card details (16-digit number, expiration date, and CVV)

Can you use Visa debit as a credit card?

Yes, you can use any debit card as credit by choosing the credit option at the payment terminal. Note that the Visa logo on your debit card simply represents the payment gateway used by your bank or credit union and doesn’t mean that it’s a credit card. This can be confusing since most people associate the payment network logos such as Visa and Mastercard with credit cards.

Key Takeaways

When you choose debit at the payment terminal, money is taken directly from your checking account after entering your PIN.
When using a debit card as credit, there’s usually a lag between when you make the purchase and when funds leave your account.
You can’t boost your credit with a debit card since it doesn’t indicate responsible financial behavior in the eyes of credit reporting agencies and lenders.
Choosing the credit option at checkout doesn’t magically turn your debit card into a credit card since you’re still using your own funds to make the purchase.
To manage your debit card wisely, use secure websites online, check bank statements regularly, hide your keypad while entering your PIN, and know your daily withdrawal limits.

Protect yourself and your PIN

Though you can’t use debit cards as actual credit cards at checkout, selecting the credit option delays the transaction process and won’t require you to input your PIN. This could be especially helpful if you don’t want to risk your PIN being stolen.

If you’re concerned about fraud or theft, consider using a credit card instead of a debit card for purchases. Compare the best credit cards to find one that fits your needs and gives you peace of mind when shopping.

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