People nowadays are becoming more proactive in using payment card in almost all of their business transaction and even for normal dealings. The payment card is an instrument that enables its owner or user to make payment by electronic funds transfer. Credit cards and debit cards are among the most common types of payment cards.

But what really are these cards for and how can we possibly use it without being burden with future debts.

A credit card is a kind of payment card issued by a financial company giving the owner an option to borrow funds within a certain credit limit. These borrowed funds will then be charged with an interest and are primarily used for short-term financing. Like how other loans work, the owner of the credit card is obliged for repayment in a determined period of time. Major credit cards which are issued through banks or credit unions, bear the logo of Visa, MasterCard, Discover or American Express. There also exist some non-bank financial institutions that offer credit cards to the public.

On the other hand, a debit card works by deducting money directly from the owner’s checking account to pay for whatever item he purchased. The rationale behind is that it gives convenience and security to the owner by eliminating the need to carry cash. One of the advantages in acquiring a debit card is it lessens or avoids the owner to go into debt because he can only use his remaining balance on the card. In some companies, the payroll card they issue to their employees for payroll purposes has already incorporated the feature of a debit card. Thus, fully maximizing the benefits of bringing a debit card instead of cash.

Both of these two types of payment cards are highly beneficial when used properly and wisely. It might be advisable for the owner of a credit card to look for zero-interest cards in making a purchase. In this way, you can save a few dollars instead of paying the interest charge. Also, embodying the right attitude is the key that purchases what you can afford and do not rely on your credit card to make up for the difference.