Choosing Between Credit and Debit While Shopping


“Credit or debit?” If you’re a regular card user when you shop, you’re likely used to hearing this question at the register. But when it comes to your spending and your budget, which option is the right option? There’s definitely a difference between the two choices and it’s important to know which choice to make.


  1. What’s the difference between credit and debit?  Depending on which option you choose, your transaction will be processed a certain way. When you choose debit, the funds are immediately withdrawn from your account and sent over to the vendor. When you choose credit, it takes a little longer to complete because the vendor has to settle the funds with the credit union or credit card company. You’ll see a hold on your account that is usually settled within two to three days.


  1. When is the best time to choose the ‘debit’ option?  By choosing debit, you’re required to enter a PIN. Because your money is withdrawn immediately, this option is similar to using cash.
  • If you have credit card debt – Use your debit card to prevent more charges adding to your existing debt.
  • If you’re overseas and looking for a better exchange rate 
  • If you’re buying from a vendor who needs to be paid immediately – Many small operations either don’t accept credit cards, or encourage their customers to choose debit.


  1. When is the best time to choose the ‘credit’ option? Shopping on credit can be beneficial in terms of building your credit history or you’re looking for more security and protection with your purchase.
  • If you’re working on increasing your credit score – Making purchases on credit and paying your card off on time can greatly help your credit history.
  • If you want better fraud protection – The Fair Credit Billing Act limits the liability for unauthorized credit card usage to $50, according to the FTC.
  • If you’re shopping online


We encourage our members to reach out to us if you have any questions about your Polam VISA debit and credit cards, any unauthorized use, and how we can help you make the best spending decisions for you and your budget.