ATM vs Debit card: What is the difference between ATM card and debit card?

Digital payments are the new norm. Gone are the days of cash transactions. It is possible to conduct all your transactions sitting at the comfort of your home.  You don’t have to step into a bank ever! If you need to withdraw cash or deposit cash, simply use ATM card. If you want to buy that new book you have been eyeing in the bookstore, just swipe your card at the PoS terminals. You can even wave your contactless debit card to pay for your purchases.

It can get confusing to understand the features of each card. Here’s what you need to know about the difference between ATM and Debit card.

 

Know the difference between ATM card and debit card

ATM card and debit card look exactly the same! Are you wondering what the difference between ATM card and debit card is?

The sole function of ATM cards is to withdraw cash from your account. Using the PIN, you can insert the card ATM and withdraw money. The ATM card is linked to your bank account. The balance of your account is reduced in real time once you withdraw money. You cannot use an ATM card for any other purpose. You cannot avail any overdraft facility on your ATM card.

In contrast, debit cards have multiple utilities. You can withdraw cash, pay restaurant bills, shop online or offline, and even clear your utility bills. Debit cards make all transactions fast, easy and convenient. What happens if the merchant establishment only accepts cash? With a debit card, you can easily withdraw cash from an ATM.

Some banks provide an overdraft facility on the debit card. Debit cards are linked to your savings account or current account. When you use your debit card for any transaction, the money is deducted from your account on a real time basis.

The key difference between ATM card and debit card is the purpose for which these cards can be used.

 

What is an ATM card?

When you open a savings bank account, the bank provides you with a card known as an ATM card. You can use this card to make withdrawals from ATM.

The ATM card is a plastic card. The following details appear on the front side of the card:

- The logo of the payment system providing the card (Maestro or Visa)

- The logo of the bank issuing the card

- Name of the card holder

- Your 16-digit card number

- The validity period in MM/YY format

- A chip which has all the details about your account

The reverse side has the following information:

- A small strip where you are supposed to sign

- Information regarding procedures for loss or theft of card

- Important helpline numbers and e-mail address to reach you bank in case of emergencies

ATM card needs to be activated prior to use.  It is possible to activate the card by either withdrawing cash or checking your account balance. All ATM cards come with a 4-6 digit password or PIN. ATM PIN must be entered to authenticate the transaction.

You can use your ATM card for the following:

- withdraw cash up to the permissible daily withdrawal limit

- check your  account balance

- transfer funds from one account to another

 

What is a debit card?

Debit card looks just like your ATM card. You need to have a savings or current account with the bank which will issue the debit card.

But you can do a lot more with your debit card. Right now, a debit card holder can perform the following using a debit card:

- Withdraw cash up to the daily withdrawal limit

- Get a mini statement of your last 5 transactions

- Get information about your account balance

- Change your PIN number

- Order a cheque book

- Deposit cash into your bank account by using an ATM machine of your bank

- Make Payments at PoS terminals accepting debit cards, both domestically and internationally

- Pay on online shopping websites, including international shopping websites

- Pay utility bills such as mobile, electricity, water and gas bills

- Book train, bus and flight tickets

- Recharge your mobile phone or DTH service

- Transfer funds from one account to another

- Purchase various products online or in stores on instalment by opting for the EMI on debit card option

A debit card resembles your ATM card. It has the same details printed on it like your name, 16-digit card number and expiry date. A small chip is also included on the front which has the details about your bank account. The type of card issued to you (classic, premium, platinum depending upon the bank and the balances maintained) is also indicated. The reverse side has a strip for signature, the CVV number and important customer care information and helpline numbers. The word ‘debit card’ or ‘international debit card’ is also mentioned on the card.

A PIN is provided along with your debit card. It is advisable to change the PIN for more security.

Banks offering Visa debit card, MasterCard debit card and Maestro debit card  are international debit cards whereas those offering RuPay debit cards are domestic debit cards.

 

Key Differences between ATM and debit card

Let us look at the difference between ATM card and debit card more closely:

Usage of the cards: ATM card can be used to withdraw money, check your account balances and transfer funds from one account to another. A debit card can be used for various purposes: you can obtain a mini statement of your account, change your PIN number, register for internet banking services, and pay for purchases on online shopping websites as well as at retail outlets.

Payment system logos: Usually, ATM cards are issued by payments systems such as Plus or Maestro. The logos of payment systems are embossed on the ATM cards. Debit cards have the logo of Visa, MasterCard or RuPay, which are the payment systems that facilitate your transactions.

Net banking facility: You cannot use ATM card for net banking services. Debit card holders can use the card for internet banking facilities. Debit card users can also access mobile banking services.

PoS payments and online shopping: ATM cards cannot be used to pay for purchases made on online shopping websites or at retail stores. In contrast, debit cards can be used to pay for purchases made at retail stores, paying for meals at restaurants, and online shopping. In fact, a debit card can be used at all types of merchant establishments and websites which support card payments. Debit cards have paved the way for cashless transaction. In case you need to pay by cash, you can withdraw money using the debit card.

As is evident from above, the difference between ATM card and debit card is on the basis of their functions.

 

FAQs

Can ATM cards be used at any ATM?

Cards issued by banks in India can be used at ATMs of any bank within India. However, there are limits on the number of free withdrawals permitted.

I have an ATM card of XYZ Bank. Do I need to pay any charges if I use it at the ATM of ABC Bank?

Every ATM card holder is allowed to undertake a maximum of 5 free transactions per month at ATMs of other banks. Any additional withdrawals attracts charges from the bank whose ATM is used. Five free transactions include both financial and non-financial transactions. Non-financial transactions include services such as account information. It can also refer to services which do not involve the payment or transfer of cash.

In case of a failed ATM transaction, is the bank liable to pay any compensation for delay in reversing the transaction?

Banks are required to compensate the customer Rs. 100 per day for delays beyond 7 working days. The customer does not have to claim the compensation. It is the duty of the bank to credit the compensation to the account. The customer has the obligation to lodge a complaint.

If the complaint is not lodged within 30 days of failed transaction, the bank does not have any liability to compensate the customer.

Is there any limit on the amounts that can be withdrawn using a debit card?

There are daily cash withdrawals limits. The limits depend on the type of debit card issued. You can withdraw from Rs 15,000 to Rs 2 lakh or even higher.

What is the main difference between ATM card and debit card? Can I use the terms interchangeably?

These terms cannot be used interchangeably. The key difference between ATM card and debit card is the kind of transactions allowed by these cards. An ATM card only allows withdrawal of cash. With a debit card,  in addition to cash withdrawal, you can pay for goods or services, utility bills etc.