ATM card and Debit card are two terms often confused with being the same. Both of them are plastic chips or cards that are used to make financial transactions. When someone opens a bank account, they provide an ATM card and a Debit card. However, there are a few differentiating factors between them.
ATM Card vs Debit Card
The main difference between an ATM card and a Debit card is that an ATM card is a pin-based card used to withdraw or transact cash from ATM cubicles only. On the other hand, a Debit card is more of a multifunctional card that can be used to transact cash, make payments and provide ease of transaction. ATM cards are not in much use as most people either use a Debit card or a Credit card.
An ATM card is a plastic card that a bank issues to the cardholder. It comprises essential information about the bank account of the cardholder. The bank issues the cards to make transactions easily from the ATMs [Automated Teller Machine] 24 hours a day. By inserting the card and putting in the pin generated by the bank or customised by the bank account holder, a person can withdraw the money.
On the other hand, a Debit card is a multifunctional card that aids the user to use it for various financial purposes. An Automated Teller machine is not required for the Debit card to function. It is a broadened version of an ATM card and is extensively used. The uses of a Debit card range from withdrawing cash to making payments that do not require the physical presence of money at any time.
Comparison Table Between ATM Card and Debit Card
|Parameters of Comparison||ATM Card||Debit Card|
|Meaning||A card issued by the bank to the account holder to withdraw money from the Automated Teller Machines 24 hours a day||A card issued by the bank to the account holder to make transactions anytime they want through a swiping machine|
|Applications||To transact or withdraw cash from ATMs||To make payments without physical cash, transfer money, and withdraw money|
|Look||A plastic card with an embedded chip and signature strip||A plastic card with a distinctive 16 digit card number with a VISA, Maestro or, Mastercard logo|
|Result on the account||The balance of the bank account is reduced in real-time when cash is withdrawn||When the card is used to make the payment, the amount is deducted from the account|
|Validity period||3 years||3 to 5 years|
What is an ATM Card?
An ATM card is an acronym for an Automated Teller Machine card. It is a plastic card coded through a pin and issued to the bank account holders by a banking establishment. The card can be utilized to withdraw money from the ATMs at any given time of day.
ATM cards can be used to purchase something by putting the Personal Identification Number or the PIN. It is often believed that ATM and Debit cards are similar; however, in reality, Debit cards are replacing the need for ATM cards. An ATM card does not have a logo on it since there use is pretty restricted. The deduction in the bank account happens in real-time when the cash is withdrawn from the ATMs.
An ATM card has become almost redundant due to Debit and Credit cards, because of its restricted applications. To avoid the confusion between an ATM card and a debit card, some of the features that differentiate them are:
- A golden microchip – helps in the verification and decoding
- Does not have any transactional logos
- There is a signing strip to identify
- A distinctive 16 digit card number
An ATM card can only be used when it is enabled. The card can be authorised by verification of the balances or by withdrawing cash. A 4 digit PIN is included in ATM cards to prevent information breaches. It is essential to put the ATM pin to make a transaction.
What is a Debit Card?
Debit cards are plastic cards with an embedded chip issued to the account holder. It can be used to withdraw money from ATMs, make online transactions, transfer money from one’s account to other. Debit cards can also make payments at restaurants and retail outlets in exchange for the service or product. They are also known as ‘check cards.’
One can use debit cards to pay for services digitally, pay your monthly bills, and even qualify for savings on internet purchases and payment services if the card is used. Debit cards provide the benefits of both an ATM card and a Credit card. Rather than making a payment via check, you can pay with a debit card online or via a digital wallet.
Instead of withdrawing cash from the ATM, one can pay from their connected bank account with a debit card. For example, one may swipe the card to pay for goods in a shop or enter the payment details, expiration date, CVV to buy something online. The transfer happens in real-time, and funds are sent directly from one’s savings account of the registered bank to the payee’s wallet or account.
Main Differences Between ATM card and Debit Card
- An ATM card is a card issued by the bank to the account holder to withdraw money 24 hours a day. Whereas, a Debit card is a card issued by the bank to the account holder to make transactions through a swiping machine.
- ATM card is used to transact or withdraw cash from ATMs. Whereas, Debit card is used to make payments without physical cash, transfer money, and withdraw money.
- ATM card is a plastic card with an embedded chip and signature strip. Whereas, Debit card is a A plastic card with a distinctive 16 digit card number with a VISA, Maestro or, Mastercard logo.
- The balance of the bank account is reduced in real-time when cash is withdrawn with an ATM card. Whereas, when Debit card is used to make the payment, the amount is deducted from the account.
- ATM card is valid for 3 years. Whereas, Debit card is valid for 3-5 years.
Although both cards provide an irreplaceable function of having money without the physical presence of cash, the use of ATM cards has become redundant. Debit cards have taken over since apart from doing the function of an ATM card, it does various other functions that make the job of making financial transactions extremely convenient. However, with the recent development, many people have even stopped carrying cards and using online forms of payment like UPI, phone wallet, etc.
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Sandeep Bhandari holds a Bachelor of Engineering in Computers from Thapar University (2006). He has 20 years of experience in the technology field. He has a keen interest in various technical fields, including database systems, computer networks, and programming. You can read more about him on his bio page.