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> you, reader, use credit cards in preference to debit cards as a payment instrument Reader from Europe here. I use debit cards for daily payments, that's just

> you, reader, use credit cards in preference to debit cards as a payment instrument Reader from Europe here. I use debit cards for daily payments, that's just the most standard expected payment method in Europe (with mobile payments now replacing it. Is a mobile payment app more like a debit or like a credit card? I have no idea actually!). But credit cards for online payments on the internet because (despite some debit card based systems existing which don't seem to work by default) on the internet credit cards seems to be the main supported payment method, including e.g. through Paypal, but also for local online shops, airlines, ... So in the US credit card vs debit card is probably an important distinction between buying on actual credit or not and all the fun stuff they have there like credit ratings, but in Europe the main distinction seems to simply be which one works for online purchases or not. Of course some reward programs for credit cards do exist here, I think American Express specifically has some benefits to the user but isn't accepted everywhere (Heard from other users, don't have this one myself. I'm not really into rewards programs myself, why not just make the stuff you buy cheaper instead?). Also, visa and mastercard seem to have no practical difference and some banks just give both. If this view is naive or incomplete, it probably just shows credit cards are indeed not as important in Europe, if they gave some huge benefit I'd have known! Edit: I don't mean to say credit and debt collection doesn't exist in Europe. All the stuff like payday loans, car loans and buying on credit from some stores exists.

williamdclt 3y ago
> Is a mobile payment app more like a debit or like a credit card? My understanding is that the mobile payment app is just a medium for a virtual debit or credit card > on the internet credit cards seems to be the main supported payment method Over many years, I've never had any issue paying with debit cards on the internet, except _once_ to rent a bike on a taiwanese website (bc they do a credit card hold).
prophet_ 3y ago
The difference I see is that in Europe, at least where I live, at the end of the month the bank will charge your bank account with the full amount of whatever is the balance of your credit card. If you have no money you will go into overdraft and that’s about it, you basically have a problem and the bank will keep nagging about that overdraft if you don’t have an agreement. The goal is to use the “credit” of the credit card for 30 days as a convenience. The implicit expectation is that it will be paid in full at the end of the month. In countries like US and South America (e.g.) many people see credit card as free money (that they don’t have), so when the end of the month comes they simply don’t have the money to pay the balance or pay very little of it. The consequence is what we all know: high interest on the balance which keeps snowballing. I know in south america banks even have interface for payment in instalments etc. Here in Europe, at least my bank they don’t have have such feature, I guess it’s just not meant to be used and abused they way it happens in other places. This is my view at least.
- developer93 3y ago
  That definitely also happens in UK, financial illiteracy and poverty/desperation exists everywhere I suppose.
- maxerickson 3y ago
  In US financial jargon, a card that expects payment in full every month is a "charge card". https://www.bankrate.com/finance/credit-cards/is-a-charge-card-same-as-credit-card/ https://www.bankrate.com/finance/credit-cards/is-a-charge-ca...
- leesalminen 3y ago
  Gotta love when you’re eating at a restaurant in Chile and when it’s time to pay they ask if you want it billed on your card in 6 monthly installments. Even as an American, it always makes me laugh a bit at the absurdity of doing that for your meals.
  - deleted 3y ago
    [deleted]
- 2rsf 3y ago
  Swedish credit cards work with invoices and you are able to pay in partial payments, overdraft doesn't exist
  - actionfromafar 3y ago
    Overdraft was a thing back when balance wasn’t checked online.
- griffiths 3y ago
  What you are talking about is a Charge card, but in Europe you can get a Revolving credit[1] card as well but I would say they are not as common as in US. On the Charge "credit" card you don't pay interest unless you go into overdraft at the end of the payment day for the month. With the revolving credit you pay the balance on your own terms but you pay the interest rate for it until closed. [1] https://www.investopedia.com/terms/r/revolvingcredit.asp https://www.investopedia.com/terms/r/revolvingcredit.asp
pm215 3y ago
This probably depends a bit on which part of Europe. In the UK the consumer protection law surrounding credit cards is stronger so it's better to use a credit card for larger purchases especially. For daily payments shops all accept both credit and debit and there's no difference to the consumer whether they happen to tap a credit or debit card.
developer93 3y ago
The advantage to the company with rewards is they get to keep your money while you think about how to spend it and you might never spend it. See gift cards & book tokens too, what a scam.
- sokoloff 3y ago
  Right now, the bank that issued my credit card has just under $2000 worth of accumulated rewards that I haven't gone to push the buttons to convert to cash in my account. If I'd consistently used a debit card instead to make those purchases, there wouldn't be any such balance, but I also wouldn't have any more money either. I don't quite see this as being something where I should change my behavior in order to avoid this "scam". One good thing that came from this thread is I went to my bank's website, clicked a few buttons, and $1990 is being converted from rewards points to cash that will hit my account next week. They really got me on that scam and I hope they'll get me again every couple of years.
  - developer93 3y ago
    Or, you know they could just pay it in without you doing anything. While that's sitting there as rewards you don't get interest on it but they can still use it.
didntcheck 3y ago
[In the UK] despite the verbiage on most sites still saying "credit card", I've been using ordinary debit cards (from both Visa and MC) online for as long as I've shopped online, and never had a single issue related to them being debit. For many years I didn't even have a credit card Edit: it's possible that this is an issue of semantics. My cards have been debit cards in every sense of the term - they are labelled as such, are linked to a specific current account, and debit it immediately - but I don't think any of mine have actually said Visa/Mastercard Debit. So strictly speaking they may be implemented as a sort of instant-clearing credit card - essentially shimming debit onto credit infra. I don't know a whole lot about the finance industry or its tech, so if anyone can chip in please do Edit 2: Ah, my current one does have "debit" in the MC hologram on the back
- quietbritishjim 3y ago
  I'm in the UK and my debit card literally says "VISA debit" in the lower right corner (with "debit" in much smaller text). In any case, there are a couple of important semantic differences between a debit card vs a credit card that you pay off immediately: * you automatically get insurance/protection for certain purchases in a credit card (so I read, I've never used it) * It's much worse if someone steals your debit card details and starts making purchases than it is for a credit card, because it's linked to your current account that you use for other stuff. If your credit card gets deactivated for a while then it's no big deal really.
  - simoncion 3y ago
    > ...because it's linked to your current account that you use for other stuff. I solve this by having separate accounts for the debit cards that get manually populated with some money every now and again. I also have a separate account to pay "Bills that will make me homeless if I don't pay them", so no matter what happens with my debit cards (and no matter how long it takes the bank-issued checks (some of my creditors still refuse to do electronic transfers, I have no idea why) to be cashed), I know those pending payments are accounted for and will not bounce.
  - tomatocracy 3y ago
Scoring6931 3y ago
Europe is huge, so it would help to be more specific. In the UK, credit card use is widespread even for in person purchases. By legislation it provides extra protection, for example by Section 75 (https://www.experian.co.uk/consumer/credit-cards/guides/section-75-protection.html https://www.experian.co.uk/consumer/credit-cards/guides/sect...)
nbadg 3y ago
In my experience (~31yrs US, ~2yrs Germany): USA: debit cards and credit cards are both offered through banks. They operate on the same payment infrastructure (Visa, Mastercard, etc). They are all equally accepted. The only difference between them from a consumer standpoint is that a debit card immediately withdraws the money from your account and typically requires a PIN for purchases, whereas a credit card operates on credit -- ie you acquire debt when you make purchases but your bank account balance stays the same -- and usually requires just a signature, and not even always that. On a credit card, you have a (very high) interest rate, but only on balances that are carried over past the end of the month: if you pay off the entire statement balance by the due date, there's no interest. More concretely: an August statement contains all transactions for August, but you receive it during mid-September, with a due date by the end of September. So by the time you've paid your August credit, you've made more purchases, and the total balance is higher than the statement balance. You only get charged interest on the August debt that is left over after the due date; September debt continues on in limbo until its statement due date. Payment processors make money per transaction, banks make money by the ridiculously high (~20%) interest rates they charge when people don't actually pay off the statement. Both credit cards and debit cards are ubiquitous; you get a debit card any time you open a checking account, and almost everyone has a credit card (77%, and the average person has 3+ cards [1]). You do not need a savings/checking account to have a credit card account at a bank. Credit card debt is extremely widespread, currently over $1 trillion USD for the country as a whole. If a merchant says "No credit cards allowed", they may still accept debit cards, even though they operate on the same payment infrastructure. Germany: the terms "debit card" (typically "Girokarte" or "EC Karte"; I've literally never heard someone outside of a finance context say "Debitkarte") and "credit card" ("Kreditkarte") are used almost exclusively to describe the payment infrastructure, and only the payment infrastructure. Girokarten operate on a completely different payment infrastructure and are accepted at most in-person merchants and government buildings. Meanwhile "Kreditkarte" is, at least in everyday language, only used to describe the payment infrastructure, and are not always accepted at in-person merchants, and only rarely at government buildings. If a government agency (or shop) says "No payment with Kredikarte is possible", they mean no payment with Visa/Mastercard/etc is possible. Whether it operates as an instant-debit or a revolving-credit basis is completely irrelevant. A Kreditkarte is always through Visa, Mastercard, etc, but a Girokarte never is. That's the primary difference here. Meanwhile, Kreditkarten that actually extend you credit are vanishingly rare in Germany; as a US citizen [2], I haven't even tried to find one, so I can't speak to the internal mechanics of actually having one. But I can say that the vast majority of people I've talked to here simply don't understand what the difference is in the US (I think this is compounded by the language barrier, because like many English -> German loanwords, "Kreditkarte" doesn't mean the same thing as its English root). [1] https://www.bankrate.com/finance/credit-cards/credit-card-ownership-usage-statistics/ https://www.bankrate.com/finance/credit-cards/credit-card-ow... [2] The US places large reporting requirements on foreign banks offering services to US citizens, making it very difficult to open accounts. Many foreign banks simply refuse to do business with US citizens. As with taxes, there are no exceptions for non-residents ("expats"). In some destination countries it can pose a significant burden to new immigrants.
Uehreka 3y ago
Not sure if this is different in Europe (check before saying it’s different, many people in the US aren’t aware of this either) but in the US at least all credit card transactions (and possibly debit too?) incur like a 3% fee. You’re paying that fee (either directly or through it being built into the price of goods) no matter what. The reason to use a card with a good rewards program is so that you actually get something in return for that small fee. So there is a sense in which you need to play the rewards game, otherwise you’re just paying more for goods for no reason.
- SOLAR_FIELDS 3y ago
  It’s a bit more insidious than that in that in a lot of stores and restaurants in America owners just bake that fee into the price instead of explicitly passing it onto the consumer and giving them the choice on whether they want to pay it. So if you use a debit card in the states you are usually actually subsidizing everyone else’s 3% fees (there are in fact places that explicitly charge the 3% fee to credit card users but they are rarer in comparison) That fee is massive business for Visa etc. There was a pretty big battle between Walmart and the credit card companies a few years ago because Walmart started defaulting to “debit” as the option when you stuck a debit card into their machines (debit cards can be run as either debit or credit) in order to save money. Which of course removed that money directly from the pockets of the payment processors.
  - refurb 3y ago
    a lot of stores and restaurants in America owners just bake that fee into the price instead of explicitly passing it onto the consumer Not really. Most businesses don't set prices based on "cost plus" methodology. Maximizing profit based on price and volume is how most do it. Some merchants may choose to absorb the 3%, to compete on price and maximize profit through higher volume than a competitor who charges the same price but doesn't accept credit cards. You "always pay the 3% fee" the same way you "always pay" for anything else the merchant may offer but you don't use: curbside pick-up, free delivery, the "free gift with purchase" you don't accept because you don't need it, generous returns policy, etc, etc.
worklaptopacct 3y ago
Are debit cards really not accepted online? I thought that save for some very specific applications, all Visa or MasterCard branded cards should work online. Never got a Visa refused, and it's a Visa Debit. I know that some places like Germany informally refer to any Visa or Mastercard as a "credit card", in contrast to true(?) debit systems such as Maestro or V-Pay. So if a place says "No credit cards", it means that Visa and Mastercard cards of any kind are not accepted.
- avar 3y ago
  It differs by banks and countries, but e.g. my Dutch debit card only has an IBAN number on it, so anything set up to accept credit card numbers won't accept it. Almost every online web shop here will accept debit cards, but it's through a Dutch specific payment mechanism (iDEAL).
  - w3ll_w3ll_w3ll 3y ago
    That's because in the Netherlands most banks used Maestro (owned by Mastercard) and Vpay (owned by Visa) as international debit circuit. The acceptance for Maestro and Vpay online is much lower than "normal" Mastercard Debit and Visa Debit. Acceptance for Mastercard Debit and Visa Debit is practically the same online as Mastercard Credit and Visa Credit. Maestro is being sunset by Mastercard and no new card can be issued. Only Mastercard Debit. So the problem with the fact that Dutch debit cards (Maestro) are not accepted online will be solved in a couple of years.
LelouBil 3y ago
In my experience (in France) everybody I know uses debit card and they are all accepted online anywhere.
paulsutter 3y ago
In the US, the terms of service are much better for credit cards than debit cards, so even folks who pay off their cards every month (for example, airline miles cardholders) prefer credit cards because of superior ToS. The terms on credit cards are expensive for issuers, so debit cards were introduced with terms more favorable to issuers. Even if they improved the terms, consumers would still be hesitant to use them because US debit cards' reputation is tainted. Europe has much stronger consumer protections, so I can only assume EU debit cards dont share the disadvantages of US debit cards. [Edited for balance and clarity, thanks]
- incongruity 3y ago
  It’s so severe that even if they improved the terms, nobody would use them because US debit cards' reputation is tainted. Say what now? “According to the 2019 Federal Reserve Payments Study1, “Debit cards, including both prepaid and non-prepaid, were used almost twice as often as credit cards in 2018, but the value of credit card payments exceeded the value of debit card payments by almost 30%.” And In Visa’s Operational Performance Data4 report for the three months ending on Dec. 31, 2020, it reports $741 billion in U.S. debit transaction volume, a 17.4% increase over the previous year. It compares to $542 billion in credit card volume. (Source: https://www.creditcards.com/statistics/debit-card-statistics-1276/ https://www.creditcards.com/statistics/debit-card-statistics...) Debit cards in the US are widely used.
  - SoftTalker 3y ago
    You need moderately good credit to get a credit card. You only need a bank account to get a debit card. The bar is much lower. And if you're including prepaid cards, those are handed out like candy for promotional purposes, as gifts, etc.
marktani 3y ago
The one case I'm aware of in Europe where debit vs. credit makes a real difference is car rental companies. They will only accept credit cards, not debit cards. Unless you also agree to pay for their shady and useless insurance (useless because typically the broker already offers better and cheaper insurance, so in this case you double pay).
metafunctor 3y ago
My Finnish debit and credit cards are equally accepted everywhere. I normally pay with Apple Pay, also sometimes chip & pin, and of course online. For all purposes, they are the same. In fact, they are bundled in the same physical card. The only difference is that one debits my account immediately (usually, unless the point of sale is not networked), and the other collects debt I usually pay off at the end of the next month. I've never had any special rewards or cash back programs associated with my cards. There is some kind of travel insurance bundled with my Visa Credit cards, but that's kind of worthless for me as I usually have other insurance in place already.
EGreg 3y ago
Required watching for you Europeans, by a man who became an expert on payment fraud (by mostly making up his background but then legitimately becoming famous and an expert LOL) https://m.youtube.com/watch?v=3Ga-M2CpRgY https://m.youtube.com/watch?v=3Ga-M2CpRgY
beaviskhan 3y ago
There is zero chance that I, a US resident, will ever use debit cards for anything. The reason is that in the event of a fraudulent charge (which still happens surprisingly often, given that chips were supposed to put an end to that): - With a debit card, I am out $X of my own money, until the bank can be bothered to agree that the charge is fraudulent and refund my money, which can take weeks or months, if at all. Good luck paying rent or buying food or whatnot in the meantime if you don't have a nice savings cushion. - With a credit card, I am out $0 of my own money, and now the bank is potentially out $X of THEIR own money, making them significantly more motivated to investigate promptly and agree that the charge is fraudulent. For however long this takes, I still have my own money to pay rent and buy food, and I'm not on the hook for paying the fraudulent charge. The fact that credit cards tend to have "rewards" in the form of cash back or airline miles or whatever is secondary to me, personally, although I do take advantage of this as much as possible.
- wpietri 3y ago
  Yeah, I don't use rewards or loyalty programs at all; I don't like giving over the headspace to corporate manipulators. But I still use debit cards very carefully because of the better protections from fraud for credit transactions. The rise of the chip card may have fixed that; it's been a long time since I've had a problem. But I'm reluctant to find out.
  - beaviskhan 3y ago
    I will say, it seems better than it used to be in the pre-chip days, but I've had to replace my primary CC once already this year due to an obviously fraudulent charge. To the credit of my bank, it was virtually painless - I had a new card in under 24 hours, and I didn't have to think about the $2000+ charge at all until they confirmed (two months later!) that it was in fact fraud.
  - ATMLOTTOBEER 3y ago
    Agreed. Using flat 1.5% cashback cards with autopay + setting the cashback balance to auto apply to each statement is the convenience compromise I have found
deleted 3y ago
[deleted]

williamdclt 3y ago

> Is a mobile payment app more like a debit or like a credit card? My understanding is that the mobile payment app is just a medium for a virtual debit or credit card > on the internet credit cards seems to be the main supported payment method Over many years, I've never had any issue paying with debit cards on the internet, except _once_ to rent a bike on a taiwanese website (bc they do a credit card hold).

prophet_ 3y ago

The difference I see is that in Europe, at least where I live, at the end of the month the bank will charge your bank account with the full amount of whatever is the balance of your credit card. If you have no money you will go into overdraft and that’s about it, you basically have a problem and the bank will keep nagging about that overdraft if you don’t have an agreement. The goal is to use the “credit” of the credit card for 30 days as a convenience. The implicit expectation is that it will be paid in full at the end of the month. In countries like US and South America (e.g.) many people see credit card as free money (that they don’t have), so when the end of the month comes they simply don’t have the money to pay the balance or pay very little of it. The consequence is what we all know: high interest on the balance which keeps snowballing. I know in south america banks even have interface for payment in instalments etc. Here in Europe, at least my bank they don’t have have such feature, I guess it’s just not meant to be used and abused they way it happens in other places. This is my view at least.

developer93 3y ago
That definitely also happens in UK, financial illiteracy and poverty/desperation exists everywhere I suppose.
maxerickson 3y ago
In US financial jargon, a card that expects payment in full every month is a "charge card". https://www.bankrate.com/finance/credit-cards/is-a-charge-card-same-as-credit-card/ https://www.bankrate.com/finance/credit-cards/is-a-charge-ca...
leesalminen 3y ago
Gotta love when you’re eating at a restaurant in Chile and when it’s time to pay they ask if you want it billed on your card in 6 monthly installments. Even as an American, it always makes me laugh a bit at the absurdity of doing that for your meals.
- deleted 3y ago
  [deleted]
2rsf 3y ago
Swedish credit cards work with invoices and you are able to pay in partial payments, overdraft doesn't exist
- actionfromafar 3y ago
  Overdraft was a thing back when balance wasn’t checked online.
griffiths 3y ago
What you are talking about is a Charge card, but in Europe you can get a Revolving credit[1] card as well but I would say they are not as common as in US. On the Charge "credit" card you don't pay interest unless you go into overdraft at the end of the payment day for the month. With the revolving credit you pay the balance on your own terms but you pay the interest rate for it until closed. [1] https://www.investopedia.com/terms/r/revolvingcredit.asp https://www.investopedia.com/terms/r/revolvingcredit.asp

pm215 3y ago

This probably depends a bit on which part of Europe. In the UK the consumer protection law surrounding credit cards is stronger so it's better to use a credit card for larger purchases especially. For daily payments shops all accept both credit and debit and there's no difference to the consumer whether they happen to tap a credit or debit card.

developer93 3y ago

The advantage to the company with rewards is they get to keep your money while you think about how to spend it and you might never spend it. See gift cards & book tokens too, what a scam.

sokoloff 3y ago
Right now, the bank that issued my credit card has just under $2000 worth of accumulated rewards that I haven't gone to push the buttons to convert to cash in my account. If I'd consistently used a debit card instead to make those purchases, there wouldn't be any such balance, but I also wouldn't have any more money either. I don't quite see this as being something where I should change my behavior in order to avoid this "scam". One good thing that came from this thread is I went to my bank's website, clicked a few buttons, and $1990 is being converted from rewards points to cash that will hit my account next week. They really got me on that scam and I hope they'll get me again every couple of years.
- developer93 3y ago
  Or, you know they could just pay it in without you doing anything. While that's sitting there as rewards you don't get interest on it but they can still use it.

didntcheck 3y ago

[In the UK] despite the verbiage on most sites still saying "credit card", I've been using ordinary debit cards (from both Visa and MC) online for as long as I've shopped online, and never had a single issue related to them being debit. For many years I didn't even have a credit card Edit: it's possible that this is an issue of semantics. My cards have been debit cards in every sense of the term - they are labelled as such, are linked to a specific current account, and debit it immediately - but I don't think any of mine have actually said Visa/Mastercard Debit. So strictly speaking they may be implemented as a sort of instant-clearing credit card - essentially shimming debit onto credit infra. I don't know a whole lot about the finance industry or its tech, so if anyone can chip in please do Edit 2: Ah, my current one does have "debit" in the MC hologram on the back

quietbritishjim 3y ago
I'm in the UK and my debit card literally says "VISA debit" in the lower right corner (with "debit" in much smaller text). In any case, there are a couple of important semantic differences between a debit card vs a credit card that you pay off immediately: * you automatically get insurance/protection for certain purchases in a credit card (so I read, I've never used it) * It's much worse if someone steals your debit card details and starts making purchases than it is for a credit card, because it's linked to your current account that you use for other stuff. If your credit card gets deactivated for a while then it's no big deal really.
- simoncion 3y ago
  > ...because it's linked to your current account that you use for other stuff. I solve this by having separate accounts for the debit cards that get manually populated with some money every now and again. I also have a separate account to pay "Bills that will make me homeless if I don't pay them", so no matter what happens with my debit cards (and no matter how long it takes the bank-issued checks (some of my creditors still refuse to do electronic transfers, I have no idea why) to be cashed), I know those pending payments are accounted for and will not bounce.
- tomatocracy 3y ago

Scoring6931 3y ago

Europe is huge, so it would help to be more specific. In the UK, credit card use is widespread even for in person purchases. By legislation it provides extra protection, for example by Section 75 (https://www.experian.co.uk/consumer/credit-cards/guides/section-75-protection.html https://www.experian.co.uk/consumer/credit-cards/guides/sect...)

nbadg 3y ago

In my experience (~31yrs US, ~2yrs Germany): USA: debit cards and credit cards are both offered through banks. They operate on the same payment infrastructure (Visa, Mastercard, etc). They are all equally accepted. The only difference between them from a consumer standpoint is that a debit card immediately withdraws the money from your account and typically requires a PIN for purchases, whereas a credit card operates on credit -- ie you acquire debt when you make purchases but your bank account balance stays the same -- and usually requires just a signature, and not even always that. On a credit card, you have a (very high) interest rate, but only on balances that are carried over past the end of the month: if you pay off the entire statement balance by the due date, there's no interest. More concretely: an August statement contains all transactions for August, but you receive it during mid-September, with a due date by the end of September. So by the time you've paid your August credit, you've made more purchases, and the total balance is higher than the statement balance. You only get charged interest on the August debt that is left over after the due date; September debt continues on in limbo until its statement due date. Payment processors make money per transaction, banks make money by the ridiculously high (~20%) interest rates they charge when people don't actually pay off the statement. Both credit cards and debit cards are ubiquitous; you get a debit card any time you open a checking account, and almost everyone has a credit card (77%, and the average person has 3+ cards [1]). You do not need a savings/checking account to have a credit card account at a bank. Credit card debt is extremely widespread, currently over $1 trillion USD for the country as a whole. If a merchant says "No credit cards allowed", they may still accept debit cards, even though they operate on the same payment infrastructure. Germany: the terms "debit card" (typically "Girokarte" or "EC Karte"; I've literally never heard someone outside of a finance context say "Debitkarte") and "credit card" ("Kreditkarte") are used almost exclusively to describe the payment infrastructure, and only the payment infrastructure. Girokarten operate on a completely different payment infrastructure and are accepted at most in-person merchants and government buildings. Meanwhile "Kreditkarte" is, at least in everyday language, only used to describe the payment infrastructure, and are not always accepted at in-person merchants, and only rarely at government buildings. If a government agency (or shop) says "No payment with Kredikarte is possible", they mean no payment with Visa/Mastercard/etc is possible. Whether it operates as an instant-debit or a revolving-credit basis is completely irrelevant. A Kreditkarte is always through Visa, Mastercard, etc, but a Girokarte never is. That's the primary difference here. Meanwhile, Kreditkarten that actually extend you credit are vanishingly rare in Germany; as a US citizen [2], I haven't even tried to find one, so I can't speak to the internal mechanics of actually having one. But I can say that the vast majority of people I've talked to here simply don't understand what the difference is in the US (I think this is compounded by the language barrier, because like many English -> German loanwords, "Kreditkarte" doesn't mean the same thing as its English root). [1] https://www.bankrate.com/finance/credit-cards/credit-card-ownership-usage-statistics/ https://www.bankrate.com/finance/credit-cards/credit-card-ow... [2] The US places large reporting requirements on foreign banks offering services to US citizens, making it very difficult to open accounts. Many foreign banks simply refuse to do business with US citizens. As with taxes, there are no exceptions for non-residents ("expats"). In some destination countries it can pose a significant burden to new immigrants.

Uehreka 3y ago

Not sure if this is different in Europe (check before saying it’s different, many people in the US aren’t aware of this either) but in the US at least all credit card transactions (and possibly debit too?) incur like a 3% fee. You’re paying that fee (either directly or through it being built into the price of goods) no matter what. The reason to use a card with a good rewards program is so that you actually get something in return for that small fee. So there is a sense in which you need to play the rewards game, otherwise you’re just paying more for goods for no reason.

SOLAR_FIELDS 3y ago
It’s a bit more insidious than that in that in a lot of stores and restaurants in America owners just bake that fee into the price instead of explicitly passing it onto the consumer and giving them the choice on whether they want to pay it. So if you use a debit card in the states you are usually actually subsidizing everyone else’s 3% fees (there are in fact places that explicitly charge the 3% fee to credit card users but they are rarer in comparison) That fee is massive business for Visa etc. There was a pretty big battle between Walmart and the credit card companies a few years ago because Walmart started defaulting to “debit” as the option when you stuck a debit card into their machines (debit cards can be run as either debit or credit) in order to save money. Which of course removed that money directly from the pockets of the payment processors.
- refurb 3y ago
  a lot of stores and restaurants in America owners just bake that fee into the price instead of explicitly passing it onto the consumer Not really. Most businesses don't set prices based on "cost plus" methodology. Maximizing profit based on price and volume is how most do it. Some merchants may choose to absorb the 3%, to compete on price and maximize profit through higher volume than a competitor who charges the same price but doesn't accept credit cards. You "always pay the 3% fee" the same way you "always pay" for anything else the merchant may offer but you don't use: curbside pick-up, free delivery, the "free gift with purchase" you don't accept because you don't need it, generous returns policy, etc, etc.

worklaptopacct 3y ago

Are debit cards really not accepted online? I thought that save for some very specific applications, all Visa or MasterCard branded cards should work online. Never got a Visa refused, and it's a Visa Debit. I know that some places like Germany informally refer to any Visa or Mastercard as a "credit card", in contrast to true(?) debit systems such as Maestro or V-Pay. So if a place says "No credit cards", it means that Visa and Mastercard cards of any kind are not accepted.

avar 3y ago
It differs by banks and countries, but e.g. my Dutch debit card only has an IBAN number on it, so anything set up to accept credit card numbers won't accept it. Almost every online web shop here will accept debit cards, but it's through a Dutch specific payment mechanism (iDEAL).
- w3ll_w3ll_w3ll 3y ago
  That's because in the Netherlands most banks used Maestro (owned by Mastercard) and Vpay (owned by Visa) as international debit circuit. The acceptance for Maestro and Vpay online is much lower than "normal" Mastercard Debit and Visa Debit. Acceptance for Mastercard Debit and Visa Debit is practically the same online as Mastercard Credit and Visa Credit. Maestro is being sunset by Mastercard and no new card can be issued. Only Mastercard Debit. So the problem with the fact that Dutch debit cards (Maestro) are not accepted online will be solved in a couple of years.

LelouBil 3y ago

In my experience (in France) everybody I know uses debit card and they are all accepted online anywhere.

paulsutter 3y ago

In the US, the terms of service are much better for credit cards than debit cards, so even folks who pay off their cards every month (for example, airline miles cardholders) prefer credit cards because of superior ToS. The terms on credit cards are expensive for issuers, so debit cards were introduced with terms more favorable to issuers. Even if they improved the terms, consumers would still be hesitant to use them because US debit cards' reputation is tainted. Europe has much stronger consumer protections, so I can only assume EU debit cards dont share the disadvantages of US debit cards. [Edited for balance and clarity, thanks]

incongruity 3y ago
It’s so severe that even if they improved the terms, nobody would use them because US debit cards' reputation is tainted. Say what now? “According to the 2019 Federal Reserve Payments Study1, “Debit cards, including both prepaid and non-prepaid, were used almost twice as often as credit cards in 2018, but the value of credit card payments exceeded the value of debit card payments by almost 30%.” And In Visa’s Operational Performance Data4 report for the three months ending on Dec. 31, 2020, it reports $741 billion in U.S. debit transaction volume, a 17.4% increase over the previous year. It compares to $542 billion in credit card volume. (Source: https://www.creditcards.com/statistics/debit-card-statistics-1276/ https://www.creditcards.com/statistics/debit-card-statistics...) Debit cards in the US are widely used.
- SoftTalker 3y ago
  You need moderately good credit to get a credit card. You only need a bank account to get a debit card. The bar is much lower. And if you're including prepaid cards, those are handed out like candy for promotional purposes, as gifts, etc.

marktani 3y ago

The one case I'm aware of in Europe where debit vs. credit makes a real difference is car rental companies. They will only accept credit cards, not debit cards. Unless you also agree to pay for their shady and useless insurance (useless because typically the broker already offers better and cheaper insurance, so in this case you double pay).

metafunctor 3y ago

My Finnish debit and credit cards are equally accepted everywhere. I normally pay with Apple Pay, also sometimes chip & pin, and of course online. For all purposes, they are the same. In fact, they are bundled in the same physical card. The only difference is that one debits my account immediately (usually, unless the point of sale is not networked), and the other collects debt I usually pay off at the end of the next month. I've never had any special rewards or cash back programs associated with my cards. There is some kind of travel insurance bundled with my Visa Credit cards, but that's kind of worthless for me as I usually have other insurance in place already.

EGreg 3y ago

Required watching for you Europeans, by a man who became an expert on payment fraud (by mostly making up his background but then legitimately becoming famous and an expert LOL) https://m.youtube.com/watch?v=3Ga-M2CpRgY https://m.youtube.com/watch?v=3Ga-M2CpRgY

beaviskhan 3y ago

There is zero chance that I, a US resident, will ever use debit cards for anything. The reason is that in the event of a fraudulent charge (which still happens surprisingly often, given that chips were supposed to put an end to that): - With a debit card, I am out $X of my own money, until the bank can be bothered to agree that the charge is fraudulent and refund my money, which can take weeks or months, if at all. Good luck paying rent or buying food or whatnot in the meantime if you don't have a nice savings cushion. - With a credit card, I am out $0 of my own money, and now the bank is potentially out $X of THEIR own money, making them significantly more motivated to investigate promptly and agree that the charge is fraudulent. For however long this takes, I still have my own money to pay rent and buy food, and I'm not on the hook for paying the fraudulent charge. The fact that credit cards tend to have "rewards" in the form of cash back or airline miles or whatever is secondary to me, personally, although I do take advantage of this as much as possible.

wpietri 3y ago
Yeah, I don't use rewards or loyalty programs at all; I don't like giving over the headspace to corporate manipulators. But I still use debit cards very carefully because of the better protections from fraud for credit transactions. The rise of the chip card may have fixed that; it's been a long time since I've had a problem. But I'm reluctant to find out.
- beaviskhan 3y ago
  I will say, it seems better than it used to be in the pre-chip days, but I've had to replace my primary CC once already this year due to an obviously fraudulent charge. To the credit of my bank, it was virtually painless - I had a new card in under 24 hours, and I didn't have to think about the $2000+ charge at all until they confirmed (two months later!) that it was in fact fraud.
- ATMLOTTOBEER 3y ago
  Agreed. Using flat 1.5% cashback cards with autopay + setting the cashback balance to auto apply to each statement is the convenience compromise I have found

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