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Credit vs. debit: What’s the difference?

Read, 3 minutes

Credit and debit cards may look similar, but their features and uses are very different. Knowing when and how to use each can help you build a stronger credit history and keep your debt levels down.

How credit and debit cards work

Both cards can help you purchase things, but they draw money from different sources. This impacts how you can use them.

Origin of funds

How funds are deducted

Access to funds

Did you know?

Choosing the right credit card is dependent on what you want to get out of it. It’s important to consider the potential fees, penalties and annual percentage rates (APR), as well as the benefits of each.

The effect of credit and debit on your finances

You may find it easier to manage day-to-day finances with a debit card because you can only spend the money available in your bank account. At the same time, it’s also worth considering the credit-building potential of using a credit card.


Potential charges


Credit score

Quick tip

Paying off your credit card balance monthly can help you keep your finances in order and improve your credit score.

Security and fraud protection for your cards

Most credit and debit cards offer you some protections against unauthorized purchases. However, it’s important to monitor charges on both cards regularly.

Fraud protection


Liability if lost or stolen

  1. Federal Trade Commission.

    * Notify Bank of America within a reasonable time of the unauthorized use or the loss or theft of your card, card number, or PIN. Certain restrictions apply. Consult your account documents for details.
Close Disclaimer

The material provided on this website is for informational use only and is not intended for financial or investment advice. Bank of America Corporation and/or its affiliates assume no liability for any loss or damage resulting from one’s reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own financial professional when making decisions regarding your financial or investment management. ©2024 Bank of America Corporation.

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