<title>Learn the difference between credit cards and debit cards</title>
<category>accounts</category>
<klink type="cncpt">Tell me the difference between credit cards and debit cards</klink>
</index>
<content>
<p>Although credit cards and debit cards may look the same and have similar uses, their functions are quite different.</p>
<p><emph>Credit cards.</emph> When you purchase something with a credit card, you're promising to pay for it in the future. The charge is forwarded to the credit card company, which in turn pays the merchant and sends you a bill. Your payment is due usually within 30 days of the time you receive that bill. If you choose not to pay the entire amount, most credit card companies let you pay a minimum amount. They charge interest on the unpaid balance. You can track credit card transactions by setting up a credit card account.</p>
<p><emph>Debit cards.</emph> When you purchase something with a debit card, the money comes directly out of your bank account. You don't receive a bill and you cannot carry a negative balance. You don't need to set up a separate debit card account in Money <mdash/> instead, track your transactions in the associated bank account.</p>
<p variant="impt">You have more protection against theft with a credit card than with a debit card because credit card accounts don't directly withdraw cash from your account. You can also stop payment with a credit card, but not with a debit card.</p>
