A debit card offers an easy way to make purchases, pay bills, and withdraw cash at automatic teller machines (ATMs). These cards are issued by banks and credit unions and offer a direct link to your checking account. While they look like credit cards, and offer some of the same benefits, they don’t involve accumulating any debt. If you don’t yet have a debit card, here’s information on what they do and how to get one.
Key Points
• A debit card allows for convenient purchases, bill payments, and ATM withdrawals directly linked to a checking or savings account without incurring debt.
• To obtain a debit card, opening a checking account is necessary, which typically requires personal information, proof of address, and identification.
• After account setup, requesting, activating, and setting a PIN for the debit card are essential steps to start using it for transactions.
• Debit cards offer benefits such as easy access to funds, budget management, secure transactions, and potential rewards programs, enhancing financial management.
• Awareness of potential fees, such as ATM charges or monthly maintenance fees, is important when using a debit card to avoid unexpected costs.
What Do Debit Cards Do?
A debit card, also known as a bank card, is a physical card that replaces the need to carry cash. You can use a debit card to make purchases both in person or online using the funds in your bank account. Debit cards are typically associated with checking accounts, though some types of savings accounts (such as money market accounts) offer debit cards. You can also use a debit card to withdraw or deposit cash at ATMs.
When you make a transaction using a debit card, the money is immediately deducted (or debited) from your bank account balance. This makes a debit card different from a credit card, which involves borrowing funds from your card issuer to make purchases. With a debit card, you generally can’t spend more than you have in your bank account, and won’t get a bill at the end of the month.
Every debit card has a unique (typically) 16-digit number and expiration date, which are usually on the front of the card. Your card should also have a three-digit debit card security code, or CSC (also sometimes called a CVV or CVC), which you typically need to enter when making debit card purchases online. Your CSC code is different from your personal identification number (PIN), which you usually need to use to complete purchases at the checkout or withdraw cash at ATMs.
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What Do You Need Before You Get a Debit Card?
To get a debit card, you generally need to open a checking account. The application process varies by institution, but you will likely need to provide:
• Your name, date of birth, and Social Security number
• Proof of address (such as a lease, mortgage statement, or utility bill)
• A government-issued photo ID (such as a driver’s license or passport)
• An initial deposit is required by some, but not all, banks
If you’re applying for a new bank account with a joint owner, they’ll need to provide their personal information and identification as well.
How to Get a New Debit Card
Once your account is open, here are the steps on how to apply for a debit card.
1. Request a Debit Card
If the bank doesn’t automatically issue you a new debit card when you open your account, you may need to request one. The bank will typically mail you your card, which can take anywhere from a few days to two weeks. If you need a card sooner you can request expedited delivery (but there may be a fee).
2. Activate Your Card
Once you receive your debit card, you’ll need to follow the instructions provided to activate it. This usually involves calling a phone number, going online, or visiting an ATM. Whatever method you choose, you will likely need to verify the card number, expiration date, and three-digit security code.
3. Set Your PIN
Either during the activation process or at a later date, you’ll need to set up a PIN, which is a (typically) four-digit numeric code used to verify your identity when making transactions. It acts as a password, ensuring that only you can access your funds. You’ll want to choose a PIN that you’ll remember but others can’t easily guess. If you ever forget your PIN, many banks allow customers to change or reset their debit card PIN via their website or mobile app’s debit help center.
The Benefits of Getting a Debit Card
There are several advantages to having a debit card. If you’re not using a debit card yet, here are some of the benefits you might be missing out on.
• Convenience: Debit cards allow easy access to funds for everyday transactions and online purchases. You can also link debit cards to mobile wallet apps for quick contactless payments when shopping in stores.
• No debt: With a debit card, you can generally only spend what you have in your account, avoiding credit card debt and interest.
• Quick access to cash: When you do need cash for payments, debit cards can be used at ATMs to withdraw money. In addition, some retailers allow you to get cash back at the checkout counter when making a purchase.
• Safe transactions: Debit card technology mirrors that of traditional credit cards and comes with features like chips, PINs, and other safety measures.
• Manage spending: Using a debit card for purchases and paying bills makes it easy to track your spending. By logging into your bank’s website or app, you can get an overview of what purchases were made, which can help with budgeting and money management.
• Rewards programs: Some debit cards offer rewards or cashback on purchases.
• Bill payments: You can often store your debit card information inside payment accounts for recurring monthly bill payments, which can simplify paying bills.
Debit Card Fees
While a debit card may be furnished by your bank at no charge to you, there are some potential fees to be aware of.
• ATM fees: ATM fees may apply when you use a machine that’s outside of your bank’s approved network. Your bank may charge you an out-of-network ATM fee and the owner of the ATM may also hit you with a fee.
• Monthly maintenance fees: Some banks charge a monthly fee for maintaining a checking account. This can often be waived with a minimum balance or direct deposit.
• Foreign transaction fees: If you use your debit card at an ATM or store outside of the U.S., you may need to pay a foreign transaction fee.
• Overdraft fees: If you have overdraft coverage and use your debit card to spend more than your account balance, your bank may cover the overage and charge you an overdraft fee.
• Replacement card fees: Losing your card or needing a replacement might result in a fee.
• Inactivity fees: Some banks charge a fee if your account remains inactive for a certain period.
Can You Get Denied for a Debit Card?
It’s possible to be denied a checking account and, subsequently, a debit card, if you have a negative banking history. While banks don’t typically report your checking and saving account activity to the consumer credit bureaus, any history of bounced checks, unpaid fees, and involuntary account closures may be accessible through ChexSystems, which is a reporting agency for the banking industry.
If you have negative information in your ChexSystems report, such as involuntary bank account closures, frequent overdrafts, or unpaid negative balances, you may get denied for a new bank account.
You may, however, be able to get a debit card with a second chance checking account. Second chance bank accounts are designed for people who may have had trouble with banking in the past and are trying to get back on track. These accounts may have limited features and benefits compared to traditional checking accounts, but they can be a good stepping stone for rebuilding banking history.
The Takeaway
Debit cards provide a convenient and secure way to manage your finances, offering benefits like eliminating the need to carry cash, secure transactions, and budgeting assistance.
Getting a debit card is a relatively simple process that begins with opening a checking account. You can improve your chances of getting approved for a debit card by maintaining a positive banking history, clearing any outstanding issues with previous banks, and ensuring your identification documents are in order.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
FAQ
What things can’t you do with a debit card?
While debit cards are versatile, they come with some limitations. You generally can’t use a debit card for activities that require a hold larger than your available balance, such as renting a car or booking a hotel room. In addition, some online subscriptions and services may only accept credit cards. Also keep in mind that credit cards usually offer greater consumer protections on purchases related to fraud than debit cards.
What things can’t you do without a debit card?
Without a debit card, you may face difficulties accessing cash quickly. In addition, you won’t be able to make cashless in-store purchases using the funds in your checking account. Your only option for digital payment will be a credit card, which entails borrowing funds and, if you don’t pay your balance in full, paying interest.
Is the process of getting a debit card hard?
No, the process of getting a debit card is relatively simple. It involves opening a checking account with a bank or credit union. Depending on the institution, you may be able to open an account online or may need to visit a branch. Once your checking account is open, the bank or credit union will typically issue and mail your debit card to your address, which you then need to activate.
If you have a credit card, do you need a debit card?
While a credit card can cover many of your financial needs, it’s still a good idea to have a debit card. Debit cards provide direct access to your funds without incurring debt, which helps with budgeting and avoiding interest charges. You can use a debit card to withdraw cash from ATMs, make everyday purchases in person and online, and manage your expenses in real time. In addition, some merchants and service providers may prefer or require a debit card.
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SoFi members with direct deposit activity can earn 4.20% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.20% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
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Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 10/31/2024. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
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