Get FREE Loan Quotes From Loan Advisor’s Top Reviewed Licensed Money Lenders in Singapore!     Click here

Get Free Quotes from the Best Licensed Moneylenders!  Click here

Debit Cards vs. Credit Cards in Singapore: Which Should You Use?

credit card vs debit card
Table of Contents

Almost all physical aspects of a debit card and a credit card are indistinguishable. It is a thin plastic item that displays bank logos, a lot of classified numbers, and dates. However, they function on a different level and for different purposes as well. 

This article will help you differentiate the main difference between debit and credit cards, what are their key uses, what these cards offer in terms of personal finance and how they can help you with your expenditures.

Moreover, identifying the difference between debit and credit card can help you navigate your personal finance and expenses. Read the article and learn what these cards could offer you!

Key Differences of Credit Cards vs. Debit Cards

We listed below the key difference between credit vs. debit card and how each of these cards functions.

Credit Cards

A credit card is a card that permits its holders to borrow money from the company that issued it. You may use up and spend up to a specific limit set by the company, which is typically a bank. Then, you are expected to pay them back, with interest when your bill comes out. You may also be interested in our post on the best credit cards for beginners.

The issuance of a credit card is divided into 4 classifications:

  • Standard cards. They do not have any specific function; it draws out a line of credit that its holder could borrow money from.
  • Reward cards. As the name suggests, this card gives back the user a kind of rebate based on their limit of spending when making their purchase. This could include cash backs, travel points, and discounts, and others.
  • Secured credit cards. This card requires the holder to put on an amount of money as collateral to the credit card company before using the card for their expenses. These credit cards offer advantages once collateral has been secured.
  • Charge cards. It does not have a spendable credit limit usable by the holder. Nonetheless, typically this cards offer credit card issuers to demand the borrower to clear the unpaid balances.

Debit Cards

Instead of making purchases through a loan from the bank, debit cards function as a payment card, whereby the money deposited in the checking account will be subtracted immediately. Holders of debit cards will also be able to enjoy similar consumer-centered protections like a credit card that is issued by Visa or MasterCard, or other reputable payment corporations.

The issuance of debit cards is divided into 3 classifications:

  • Standard debit cards. A standard debit card withdraws the desired amount of money from the bank checking account linked to the card with fundamental functionality.
  • Electronic Benefits Transfer (EBT) cards. EBT cards are issued as instructed by the state and federal organizations. These cards are given to users deemed eligible by the agencies to use it in making their purchases.
  • Prepaid debit cards. These cards allow people who cannot access their bank account to withdraw or transfer money to still make electronic transactions with the amount that has been loaded in the card before the transaction.

Husband and wife using card happily

How do Both of Them Work?

We list down for you how debit vs. credit works and how both of these cards ease your financing in their ways.

Eligibility Criteria

Credit cards are attainable if the applicants meet specific requirements. For example, credit card issuers, like banks, want to see your credit scores before issuing you the card. A person who wishes to own a credit card will be expected to make at least $SGD 2,000 monthly in Singapore.

A debit card, there is no particularity that holders are supposed to fulfill. One would only need to open up a bank account with a branch of the bank of his or her own choice to get a debit card. Nowadays, banks give out ATM cards that could function as debit cards once you sign up with them. It is also a more straightforward process in which there is almost no waiting time for you to get your card.

Purchasing Power

As said earlier, potential cardholders themselves can make this decision, but as a comparison between debit card vs credit card. As with credit cards, you are allowed to spend upon your account’s set credit limit. Every individual may have a differing amount of credit limit. This is because it depends on one’s salary, credit history, and promotional terms. Having a good credit score, you may get the privilege of spending on your credit cards double the value for your monthly salary. It would make such a positive difference.

A debit card has a daily usable limit. In general, it is from $2,000 up to $5,000. If you have deposited more than the amount in your bank account, there will surely be funds left in the card. It does not substantially impact your consumer buying power because a debit card is quite an electronic money.


When your credit cards have been used fraudulently, you cannot pay the company the whole amount of the total sum spent. You will only be required to pay the liability limits. What is more, cardholders can also block any payment made without their authorization. It is also safer for when the goods and services are unsatisfactory.

In contrast to a debit card, any transactions made are instantly approved and processed. Hence, your funds are used there and then. Getting back your cash might need quite a bit of time. In some cases, you would have to go to the extent of lodging a police report. However, holders are still protected through daily spending limits.

Lady using card happily

Discounts and Rewards

Customers are qualified for discounts and rewards from both cards. Beyond that, having only a debit card may not give you as fancy as what discounts and bonuses on credit cards would. Rewards concerning debit cards are typically more trivial ones, namely, discount on food combo packages through a specified application or a very small rebate with every purchase or mobile phones’ bills.

In terms of discounts and rewards, credit cards offer more significant rewards and discounts such as a certain percentage of cash backs, frequent flyer miles, entertainment, etc.

Interest Rates and Fees

For the most part, debit cards do not incur the customers any charges of interest and fees. However, cardholders do have to bear a small number of transaction fees when making a purchase abroad. This also includes when you have to withdraw money from an ATM other than your card’s bank.

Having a credit card, however, one would have to endure the cost of late payment fees as well as interest rates. One burdening factor of a credit card regarding additional charges is that these payments and interest would build up and leave you in debt without a proper spending plan.


If you are a big spender and have uncontrollable spending habits, it is a much better idea for you to manage your financing through a debit card. It is effortless to get strayed away from spending on a credit card without having someone or a way to check and balance your expenditure.

Even so, if you have the luxury to afford extra fees and are very confident that you will make your credit card payment on time every month, the freedom to choose is yours.

lady holding a card

When Should I Use a Credit Card?

It would be wise to have a credit every time, it can ease your worry of carrying a large sum of cash, however there are also factors you need to consider whenever you use it. You should use your credit card when:

1. You are trying to minimize your expenses through Mode of Payment

You could cut some costs when using your credit card solely as a mode of payment. For instance, it is smart to use a credit card when you could clear your debts in full every time. The reason for this is that cardholders would be getting a rebate of a certain amount for every dollar you borrow.

2. You want to build a good credit score

A cardholder would have to repay all of the funds you have borrowed when making your purchases when it is due. You could build up an excellent credit score by making payment on time when it reflects on your credit report. In turn, your credit card company will acknowledge you as a disciplined and responsible borrower.

3. You need urgent funding in foreign countries

Having a credit card to be your financing instrument when you are in other countries is much better. What is more, it is more convenient and cheaper, of course. One needs to activate the card’s international usage. Unlike asking somebody to send you money through a third-party platform like Western Union, they charge you additional fees.

4. You want to make an online purchase

We would recommend you own both MasterCard and Visa credit cards. This is because some websites or applications would accept one or the other. This way, you can get cash backs, rewards, etc.

5. You need a concierge service

Credit card companies enable cardholders to enjoy a concierge service whereby an attendant from the company will attend to your needs of last-minute travel planning and bookings.

Read more about credit card benefits.

men holding card

When Should I Use a Debit Card?

As electronic money, debit cards are helpful for quick cash and swipe at your purchases. But there are still things you need to keep in mind to maximize its value. It would help if you were using your debit card for:

1. Settling a rollover debt

We recommend that you clear off your rollover debt from your credit card solely through your debit card. Leaving balances in your credit card will resort to steeper interest rates.

2. Giving your child a card

It is safer to let your child only spend through a debit card with a daily spending limit. The privilege of getting to pay double or triple your salary amount on a credit card may over excite the child and cause unnecessary problems in the long run.

3. Preventing overspending

If you know yourself as not being the most mindful when making your purchases, it would be smarter to use your debit card when shopping.

4. Avoiding annual fees

Unlike a debit card, credit cards have several yearly fees at around $128 up to $300. If this would affect your financing in any way, you will be better off using a debit card.


All in all, we would suggest that you have each of both. Both cards could benefit you in different but beneficial ways to you as a cardholder. You could use both of them and use them in different modes, as we listed above.  You have the prime power in choosing what is best suited for you. 

In case you are needing quick cash that these cards can’t cover, it’s wise to get a loan from a trustable source. Don’t know where to get a quick loan? Not to worry, you may log onto Loan Advisor. The website enables you to compare different companies with their rates and terms and conditions. It may be an excellent place to start researching.

Table of Contents

Looking For An Urgent Personal Loan?

Submit your details and receive up to 3 loan quotes from best Licensed Money Lenders picked by Loan Advisor
  • Hidden
  • This field is for validation purposes and should be left unchanged.
Looking for a Loan?