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Credit Card vs. Debit Card: Which One Should I Choose?
Credit Card vs. Debit Card: Which One Should I Choose?
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Credit Card vs. Debit Card: Which One Should I Choose?

Money254
Doris Kendi
January 20, 2022

Why should I get a credit card when I can just use my debit card? This is a question that has one time or another run through our minds, right? After all, a credit card is a debt card. 

But what if I told you there are many benefits of using a credit card over a debit card? For example, using a credit card allows you to build on your credit history while also earning valuable rewards on the side. 

However, before you call your bank for a credit card, you must understand the difference between the two so that you can make the right decision to suit your financial needs. 

How Debit Cards Work

Using a debit card is the same as spending your money. Your bank issues a debit card to allow you to access your money without the need to write a check or make cash withdrawals. The card is linked directly to your current account and allows you to use it the same way you would a credit card, except the money you spend is directly deducted from your account balance. 

When you swipe your debit card to make a payment, the money is deducted from your bank balance and placed on hold by the bank for 24 hours or more before it is released to the merchant. 

You can also use a debit card to withdraw money from the bank counter or an ATM using a unique personal identification number (PIN). 

How Credit Cards Work

Unlike a debit card that allows you to spend your money without incurring any debt, a credit card is a debt instrument that allows you to spend borrowedmoney conveniently. The amount you can spend depends on the credit limit you qualify for.


When you make a purchase on a credit card, the amount is added to your outstanding balance. You are supposed to settle this balance before it falls due, after which it will start accruing interest. Most credit card issuers in Kenya have an interest-free period ranging from 30-55 days. 

Read On: What is a credit card interest-free period and how can I take advantage of it?

Most credit card issuers offer rewards and privileges to their cardholders. For example, you can earn loyalty points, cash backs, and various other perks from just using your credit card. 

Debt expense on credit cards can be notoriously high if you do not use them responsibly and settle your bill on time. 

Learn More: Credit Cards in Kenya: Dos and Don’ts (How to Use Credit Cards Responsibly)

What Is the Main Difference Between a Debit Card and a Credit Card

Essentially, both debit cards and credit cards give you extra security against fraud, giving you the convenience that comes with eliminating the need to carry cash. However, they do have several key differences:


Key Advantages of Debit Cards

  • You are spending your own money; hence no debt is involved, and there is no risk of repaying interest. 
  • You can use it to withdraw money from a bank counter or an ATM with no extra interest imposed. 
  • A debit card doesn’t have a lengthy approval process compared to a credit card. 
  • You do not have the anxiety to chase after a deadline to ensure the bill is paid as you do with a credit card.
  • Not many fees are incurred.
  • Although they can’t help you build a credit history, debit cards can’t hurt your credit history either. Win-win. 

Key Advantages of Credit Cards

  • A credit card helps you build on your credit history.
  • Credit cards can provide flexibility, helping you buy things now (sometimes pricey items) and spread repayment out over time.
  • A credit card is a convenient way to allow you to spend a pre-approved debt.
  • A credit card allows you to earn rewards and points while you spend. You may be able to redeem them on things like travel, cashback, free dinners, etc. 
  • If you settle your bill on time, you get to borrow money for free. 
  • Your credit card statement is a cool way to track your expenses and help you budget.

When to Choose Credit Card vs. Debit Card

As you can see, each has its advantages. Therefore, choosing what is best for you depends on how you plan to use the card and how responsible you are as a card user.


Hence, before you pick one, it is crucial to understand the difference between the two; the risks, benefits, fees, and uses. Here are some of the main factors to consider to ensure that you get maximum benefits from your card.

  • Fraud protection. Although both cards have fraud protocols that protect you from theft, their process of getting your money back differs. So ensure you read the fine prints when applying for your card and ensure you understand the terms and conditions. 
  • Spending control. The explanation on this one is pretty obvious. If you have no brakes on your spending habits, it is better to stick to spending your own money and avoid going into debt.
  • Fees. You should also consider this when deciding the card that will suit your needs. 

All in all, the final decision will depend on your own private judgment and your general financial standing. 

Doris is a finance professional, freelance writer and SEO expert. She has experience helping businesses of all sizes create content that helps improve their site quality and increase their online traffic. She is a personal finance and wealth creation enthusiast and a frequent contributor to Money254. Visit Doris' personal website to learn more about her work.

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