More and more citizens rely on credit and debit cards. Along with PayPal, Visa and Mastercard are the most common means of payment for online shopping trips. However, which card you get as standard with your current account at your own bank is not regulated by law and differs from case to case. There are currently a lot of changes when it comes to credit cards.
The Berlin DKB is one of the most popular direct banks in Germany. Their customers have received mail in the past few months. So there are changes to the cards. While “DKB Cash” originally included a giro card and Visa credit card, the Berliners are now using a so-called Visa debit card. But what exactly is the difference and what are the advantages and disadvantages of bank customers when changing? TECHBOOK explains the details.
Credit cards with collective billing
In Germany, a credit card is commonly understood to mean so-called “charge cards”, which in most cases are issued by the two major providers Visa and Mastercard through their house banks. With this type of card, all purchases and cash withdrawals are collected and debited as a total amount from your current account on a fixed date of the month. Ideally, you get a loan for up to 30 days. With some credit cards, this interest-free payment term is even extended. An example of this is the “Barclays Visa”. Such a classic charge card was previously included in the DKB current account, but this has changed.
Instant billing for debit cards
The situation is different with debit cards. These are usually also issued via the two well-known issuers Visa and Mastercard and work like classic giro cards. Accordingly, cashless payments in retail, online or cash withdrawals at ATMs are debited directly from the deposited giro account. A key advantage of debit cards is their transparency. You can see immediately on the checking account what amount was paid with the card. Above all, there is no risk of going into debt, because you can really only spend the money that is in the account. Any available overdraft facility is also included.
A disadvantage of debit cards can be their use in certain situations, for example when renting a car or using them in hotels. Because of the immediate billing, providers often have problems securing the deposit. For example, if there is damage to the rental car that is only discovered after it has been returned, the settlement has already been made and the rental company has a hard time getting money back from the renter. Because of this, some hotels and rental companies will not accept the debit card and instead require a “real” credit card.
Beware of fees
In most cases, bank customers pay an additional annual fee of between 20 and 30 euros for classic credit cards, especially at branch banks. In addition, cash withdrawals from ATMs with these cards are often particularly expensive. So it is often not worthwhile to order such a credit card from your own house bank. Barclays in particular offer attractive conditions in this regard with the already mentioned “Barclays Visa” or the “Genial Card” from the Hanseatic Bank. There is no monthly fee for either provider, and no separate fees are charged for cash withdrawals at ATMs worldwide.
Cost trap partial payments
Some credit cards are set to a so-called partial payment function by default. Accordingly, not the full amount of all transactions made is withdrawn from the current account every month, but only a certain proportion of the balance (eg 20 percent). Significant debit interest then accrues for the remainder. In order not to slip into a cost trap here, you should always make sure that you balance your total balance immediately. This can be set via the provider hotline or in the online banking of the credit card. Especially with the DKB credit card, this option is already preset. Important to know: Even if charge cards are no longer part of the DKB offer, customers can still add them to their account for an extra fee. However, in most cases this is not worth it. Our recommendation: After opening the DKB current account, simply apply for the Barclays Visa or Hanseatic Bank Genial Card.
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Acceptance problems at dealers
More and more banks are only issuing debit cards, but no longer Girocards, i.e. classic money cards. However, this becomes a problem for certain dealers. For example, some pharmacies or post offices do not accept Visa and Mastercards. In such cases, the only option left is to withdraw cash from the ATM beforehand. It can therefore make sense to open another account with a bank that still offers Girocards for such cases. Savings banks and Volksbanks in particular will probably continue to offer these in the future. Nevertheless, there are no uniform rules at regional banks, which is why bank customers should inquire about this individually at their institute.