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4 myths about debit cards and why you should not believe them

4 myths about debit cards and why you should not believe them

  • 21 January 2020
  • By OCBC Silver Years
  • 10 mins read

ATM vs. Debit Cards

Debit cards might sound a bit scary if you’ve never used one, or if you’re not even sure if you have one. In reality, they are very safe and simple to use, and most of the misconceptions people have about them are unfounded.

Debit cards have all the simplicity of ATM cards, enabling you to withdraw cash at ATM and pay by NETS. But they also have some additional features that bring you added convenience, such as enabling you to earn cash rebates on your spending and make online purchases.

Common misconceptions about debit cards

Before delving into the benefits of using a debit card, there are some misconceptions that must be dispelled, such as the following.

Myth #1: Debit cards are less secure than ATM cards

Banks put in place numerous safety features so that you can use your debit card without fear of unauthorised transactions.

Most debit cards are now equipped with EMV chips which make each transaction more secure.

To limit the amount that can be charged to your debit card, you can set a daily spending limit. You can easily change this limit at an ATM or by contacting your bank.

Other safety features include disabling overseas cash withdrawal and receiving transaction alerts via SMS.

In the event of theft or loss, you can contact your bank immediately by phone so the card can be deactivated, just as you would do with an ATM Card.

Myth #2: Debit cards are less convenient than ATM cards

Debit cards let you do everything an ATM card does – withdraw cash using your PIN at ATMs locally and overseas, and pay by NETS.

In addition, you can also pay by signature and make online purchases. Therefore, it is safe to say that debit cards offer more convenience than ATM cards.

Myth #3: Debit cards can land you in debt

When you pay by debit card, the transaction amount will be debited from your account balance instantly, just like when you pay by NETS.

If your bank account does not permit overdrafts, there is no danger of getting into debt or being charged interest.

Myth #4: Debit cards are more expensive to use than ATM cards

Many debit cards can be used without paying any annual fee. For instance, OCBC YES! Debit Card cardmembers enjoy a lifetime annual fee waiver.

What’s more, if you use a debit card that rewards you with cash rebates when you spend, it could end up being cheaper to use than an ATM card.

Benefits of the OCBC YES! Debit Card

Let's use the OCBC YES! Debit Card to illustrate the benefits of debit cards. Here are some of the card's features.

Benefit #1: 1% cash rebates

As long as you make Visa transactions of at least S$400 a month on the OCBC YES! Debit Card, all your transactions in the following categories earn you 1% of your money back in the form of rebates:

  • Transport – Grab, Comfort and CitiCab rides
  • Online spending – Zalora, Lazada, ASOS, iHerb and FairPrice Online
  • Convenience stores – Cheers, 7-11
  • Fast Food – McDonalds, Subway, Burger King and more

This means that whenever you spend on any of the above, you receive 1% of your money back. By contrast, ATM cards do not earn you any cash rebates.

Benefit #2: Online purchases

A debit card enables you to make purchases online, whether on local or international sites. When you pay online using a debit card, the payment amount is immediately deducted from your bank account.

By contrast, you cannot make online purchases using an ATM card.

Benefit #3: Visa payments

Many merchants accept payment by Visa.

You will also be able to pay by Visa PayWave simply by tapping your OCBC YES! Debit card against a sensor, which is convenient and time-saving. When overseas, Visa is also widely accepted across merchants.

By contrast, an ATM card enables you to make payments only by NETS which is rarely available overseas.

Benefit #4: Withdrawal of cash at ATMs

Just like an ATM card, you can withdraw cash at ATMs using your debit card.

Benefit #5: Payment by NETS

Like ATM cards, debit cards are equipped with NETS transaction capabilities that enable you to pay using a PIN.

Debit cards offer all the conveniences of ATM cards while being equipped with lots of other useful features. With a debit card, you'll be able to shop earn cash rebates, shop online, and sign for purchases, too.

To enjoy these benefits, apply for the OCBC YES! Debit Card.

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