What is a "debit card"?

What is a "debit card"?

Mitchell Freedman, CPA/PFS (CEO, MFAC Financial Advisors) gives expert video advice on: How can I get a lower interest rate or APR on my current card?; What if I pay my credit card bill late?; What if my credit card is lost or stolen? and more...

A debit card is a relatively new innovation and financial tool which has arisen in recent years, and I'm seeing more of my clients utilize the debit card. The debit card may look very much like a credit card, but it is not. It works like a credit card in that you can go to a vendor and instead of writing a check or handing them cash, you hand them the debit card. And you'll get a receipt when you use a debit card, just like you did with a credit card. However, immediately upon the debit card transaction hitting the vendor's computer, that amount is deducted from your checking account. So a debit card is an automated check-writing function.