3 ms·

not related but is "prepaid credit card" a debit card? Also why is the card with the debt is called "credit" and the one with actual money is called "debit"? Dr

• ask_b123 4y ago
  Possibly because debit is debt from the bank's POV? They owe you that amount of money. I'm not sure though.
• pc86 4y ago
  No, a "prepaid credit card" is a credit card with a balance of $0 but you pre-pay a certain amount. So you buy a card for $500, you can charge up to $500 on it then it's useless. Similar, but not linked to any bank account. A debit card debits from your account. A credit card requires the bank to extend you credit.
  • morpheuskafka 4y ago
    In that case the card effectively is a bank account of its own and often has features such as accepting direct deposit. I believe those cards are regulated as Reg E (EFT/debit) and not Reg Z (credit). They aren't regulated as banks, though a lot of them do place the money with a bank to get FDIC protection, but there was a major regulation change for these accounts a few years back that added more requirements for fee disclosure and ID verification.
• happyopossum 4y ago
  When you have a credit card, the issuer is providing you credit, and a debit card draws on debits from your checking account.