Difference between debit and credit cards

While both debit and credit cards can be used to pay for purchases without cash, these two card types are very different. Discover how.


Credit Card vs Debit Card


What is the difference between a credit card and a debit card?


The biggest difference between a debit and credit card is where the money comes from. When you spend with a debit card, payment is taken directly from your bank account, while a credit card borrows funds from a card provider that you
have to pay back.


With a debit card, you typically can’t spend more than what’s in your account, unless you have an overdraft. Whereas when you pay by credit card, your card provider covers the amount, and you then repay your provider. If you don’t pay your credit card balance in full each month, you’ll likely be charged interest on the outstanding amount. 


How does a debit card differ from a credit card, in summary?


  • A credit card offers a line of credit that acts like a mini loan, meaning you’re not limited to the amount in your bank account. 
  • A debit card instantly deducts payments, only allowing you to draw on the funds within your bank account. 
  • With a credit card, if the full amount spent is not repaid when you receive your bill, you’ll be charged interest on the outstanding amount.
  • Debit cards carry less risk of getting into debt, particularly if you don’t have an overdraft, but they can limit your financial flexibility.
  • Debit cards don’t tend to offer the same types of rewards as credit cards.

Find out more on how credit cards work here.


Credit card vs debit card: how to choose


To help you choose between a credit and a debit card, consider which features best suit your financial needs, and what card benefits may complement your lifestyle.


If the following fits, then a credit card could be a good option for you:


  • Greater financial flexibility, helping you to pay for purchases over several months, or all at once. Although remember interest fees may apply if you do not repay your balance in full each month.
  • Build a good credit history when used regularly and repaid on time.
  • Extra security. American Express® Cards offer 90-day Purchase Protection and Card security features.
  • Get rewards for your everyday purchases. Some of our Credit Cards offer cashback and some reward customers with Membership Rewards® points that can be redeemed for a wide range of treats and experiences.
  • Travel benefits. At American Express, our Singapore Airlines Credit Cards allow you to earn KrisFlyer miles and offer perks such as Travel Accident and Inconvenience cover. A great benefit for those always planning their next adventure.

Discover more about American Express Credit Card benefits and decide whether a Credit Card could work for you.


On the other hand, debit card benefits include:


  • Less risk of debt as you’re paying straight from your bank account.
  • They’re often cheaper – many debit cards don’t have annual fees and offer free cash withdrawal.
  • There are no monthly statements to settle unlike with credit cards. So you won’t have to worry about missing a payment or paying a late fee.

Simply weigh up what matters to you most – whether it’s a low-fuss, no-cost card or one that offers you greater rewards.


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Want to learn more about Credit Cards?


Check the types of Cards that American Express offers


American Express offers a range of Credit Cards and Charge Cards with different rewards and benefits tailored to your lifestyle and interests.




Check the Credit Card fees


The charges you pay partly depend on the type of card you have and how you use it. Some of our cards have first year annual fee waivers. You can view our first year fee waived cards below. 





Check the Credit Card interest rates


Learn about APR (Annual Percentage Rate) and how interest gets calculated. Knowing this can help you choose the right card.







To save time, use the following checklist to see if you meet our standard eligibility criteria:


I am aged 21 or over 

I have an income that meets the minimum for the Card I am interested in

Some Cards may have additional specific eligibility criteria, and you will be asked to provide employment, income and bank account information in order to submit your application.


Once you have found the Card that best suits you, read the important information, then click the 'Apply now' button on the page to begin the application process. At this point, you can choose optional additional benefits and also decide how you'd like your name to appear on your Card.