What is a Debit Card
Debit card is a plastic issued by a bank where a customer has a savings or current account which allows the customer to withdraw money from the same account. Since this card is linked to a customer’s account, there is no loan/credit from the bank’s side. Do read this article to understand how a debit card is different from a credit card.
Yes, there are multiple variants available for a Debit card. They may vary in terms of how a specific transaction is authorized or the nature of the underlying account of the debit card. E.g. it could be a PIN only, signature only, Dual verification, Chip enabled, Premium debit cards, Prepaid debit cards etc.
What are the types of Debit cards in India
India has a strong and growing banking network. A good indicator of this is the variety of financial products available in each segment. The same is true of Debit Cards also, where there exists a wide variety of debit cards in India. Here’s a list of some of the common types of Debit cards one can find in India
PIN Only Debit Cards : Many debit cards need the account holder to punch in a 4 digit PIN when doing a retail transaction using their Debit card. This PIN authorizes the transaction real time to validate whether its the genuine account holder who is doing the transaction or not. Once the PIN is confirmed, account balance is checked and the transaction is authorised. PIN enabled Debit cards allow for an additional layer of security when compared to signature only debit cards.
Signature Only Debit Cards : In the early days of Debit cards, a transaction was authorised by a simple signature from the account holder. This posed a lot of challenge as far as the account security was concerned as anyone who could get access to the customers debit card and forge a signature, could use the debit card to do fraud transactions. Hence PIN based debit cards or Dual Use Debit cards were introduced. Signature only debit cards are almost fully withdrawn from India now.
Dual Use Debit Cards : As the name suggests, Dual Use Debit Cards allowed for both PIN based and signature based authentication of transactions. This was introduced to allow for flexibility and introduce an additional layer of security in debit card transactions. Currently in India, most debit cards are PIN based and/or chip-enabled.
Chip enable Debit Cards : Also known as EMV Chip Debit Cards, these debit cards have an inbuilt chip which stores certain card related information on the card itself. Prior to the chip enabled cards, magnetic stripe enabled cards were in use. These cards had a card number, expiry date on the front and a magentic stripe which carried the same information in an encoded formate on the reverse. An EMV enabled debit card allows for higher levels of security and also allows for additional features to be enabled on the plastic. The chip can store applications like an e-wallet or help the issuer do smarter approvals of transactions.
ATM cum Debit Cards : Most banks in India, have debit cards that can be used at bank’s ATMs apart from using the card at retail outlets. These are referred to as ATM cum debit cards. Some banks issue cards that are purely ATM cards – which means that the card cannot be for retail transactions but only for cash withdrawals at banks ATMs or non-bank ATMs.
Premium Debit Cards : Since debit cards come loaded with many features and benefits, banks in India have variants available in their debit cards portfolio. Debit cards issued to private banking clients or account-holders with higher balances have much more benefits like discounts on dining, Such debit cards issued to high net worth individuals are referred to as Premium Debit cards. There are many such premium debit card variants available in India also e.g. the ICICI bank’s Coral Debit Card.
Prepaid Debit Card : Also referred to as a prepaid card, a prepaid debit card is issued usually to customers who do not have a full banking account. Referred to as the “card for unbanked”, this form of plastic reduces the risk of the bank and also allows the account holder to use an alternative to cash when it comes to regular transactions. In India, prepaid cards have seen a high growth rate and its expected that with the arrival of Payment Banks, their numbers and usage will witness a further growth.
Debit Card types in top banks of India
- Debit Card types in SBI
- Debit Card types in AXIS Bank
- Debit Card types in HDFC Bank
- Debit Card types in ICICI Bank