Debit Card

A debit card takes money straight from the linked account at the moment of payment. Unlike a credit card, you are not borrowing — you can only spend what is in the account, and payment is declined if the balance runs out.

Its main benefit is restraining overspending. The spending limit is simply your balance, so debt cannot accumulate, and never being surprised by next month's statement makes a real psychological difference.

Rewards are thinner than on credit cards: lower discounts and cashback, and no instalments. Card issuers earn no interest, so they have less to give back — though many debit cards carry no annual fee.

Credit scoring is the weak point. Debit card usage counts far less toward a credit assessment than credit card usage does. If a loan application is coming, using a credit card steadily, even for small sums, helps.

The practical answer is splitting them. Control variable living expenses with the debit card, and put a couple of fixed bills on a credit card to build the record — that captures both advantages.