The credit card is often associated with a credit card, which is wrong because it is actually a debit card. Indeed, there are three different types of credit cards that are the credit card, the debit card and the prepaid card. A glance at these three very different payment methods.
This type of card is modeled on the Anglo-Saxon model, because credit cards are much more widespread in the United States than in France. However, this model is also available from us and will often be associated with a revolving credit. Indeed, by making a payment with a credit card, the funds will be provided by the bank in the form of credit. The sum is not deducted from the current account. At the end of the month, the owner of the card will have to pay his debts, ie the various sums advanced by his banking establishment to start from scratch the following month. It is therefore the same operation as the revolving credit with a payment card available.
To obtain this type of card, a contract must be made between the bank and the customer. The latter will define the maximum amount that can be spent, the rate, the terms of repayment, the cost of the card, management fees, etc.
Opting for a credit card can be tempting, but you have to make sure you can pay safely. In fact, since the expenses incurred are not directly debited to the current account, it will be necessary to be able to repay its various expenses and the associated costs. Making sure you have the funds to pay the bill will be a prerequisite if you do not want to go into debt.
The debit card
It is the most used card in France. This is a card associated with an account that will either only withdraw cash from the distributor, or be able to withdraw cash, but also make payments in store and online.
When the debit card is used, the sum spent is directly debited to the account associated with the card. In most cases, this will be the current account of the card owner, but it is also possible to associate a card with a savings account.
Depending on the offers offered by the banks, debit cards may have several options such as capping payments, an authorized overdraft (which will therefore not involve agios within this limit) or the payment without contact. An annual fee will be paid to fund the use of the debit card and the amount will be set according to the options and freedoms that the card in question allows to have.
The prepaid card
The prepaid card is a card that will allow people who do not have a bank account to use a card modeled on a debit card. A very interesting possibility since not having a credit card can be very problematic in everyday life.
Prepaid cards can be offered by banks, but also in shops with this type of service (often these are offers offered by neo-bishops). To be used, a sum of money must be deposited and will be credited on the prepaid card, the latter can then be used until funds are exhausted. However, a limit will be set as to the amount that can be deposited (generally, a prepaid card can not exceed the 1000 dollars of funds available).
In addition, there are several limits to consider as a maximum amount allowed per transaction or an annual deposit limit. The prepaid card is an attractive option for making secure online payments or for dealing with a temporary need. As soon as possible, it will be preferable to open a bank account and opt for a debit card in order to manage your budget in a simpler and more stable way.
In short, everyone can find the card that suits him between the credit card, debit card and prepaid card, it will even be possible to accumulate all three if desired, but beware of management fees and different costs!