25 Sep

Credit vs. Debit – Which should you choose?

Choosing credit or debit RMLEFCUYou get to the end of the checkout line, swipe your debit card, and a clerk asks you “Debit or Credit.” What do you choose? You’re using a debit card so choosing ‘debit’ seems like the obvious choice. However, you may also choose credit. So what is better?

When to choose debit.

If you need cash back, choosing debit is a great option. Debit, or PIN based transactions, are processed through the ATM network. This gives you access to your cash from any place that offers cash back. A PIN based transaction is anytime you use your PIN number when paying. This is a convenient way to get cash without having to go to an ATM.

When to choose credit.

Every other time! There are many reasons why it is more advantageous for you to choose credit. A credit transaction still deducts cash directly from your checking account, so on the surface credit and debit are the same. However, continue reading and you will see the benefits to choosing credit when you belong to a credit union.

  • Added Layer of Security – Your PIN number is very important and should never be shared. However, every time you enter your PIN number, you run the risk of someone seeing it and potentially using it. Debit transactions don’t have the same security as credit transactions. A thief can empty your checking account and there is little we can do to replace your funds. By selecting credit, you add an extra layer of security to your transaction.
  • The Credit Union Benefits ­– When you select credit, Rocky Mountain Law Enforcement Federal Credit Union will receive the interchange fee. Why does that matter? As a member of RMLEFCU you actually own a part of the credit union. Profits are returned to you in the form of better rates on loans and higher dividends on savings accounts. Each time you select signature credit, you are earning the credit union (and yourself) more money.
  • Earn More Cash – We have two Kasasa checking accounts that pay you cash. With Kasasa Cash you earn interest on money in your checking account and with Kasasa Cash Back you earn cash from purchases. However, in order to qualify for these accounts you have to make 12 signature based credit transactions with your debit card.

As you can see, the only time it really makes sense to choose debit is if you need cash back. Otherwise choosing credit is a much safer option that also earns you and the credit union more money! So remember to choose ‘credit’ next time that person asks you “credit or debit.”

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