A debit card is basically a card used for fund transactions. Going by the name plastic cash, bank card and more, you can enjoy electronic access to your savings account in any bank via ATMs. You can deposit and withdraw as per your convenience this way without the hassle of standing in long queues. The same can be utilized for mobile banking and internet banking.
BankLoanGuru provides an easy online process to apply for any debit card of your choice with instant e-approvals. Customers can also compare the different debit cards offered by banks and pick what they find suitable for themselves. The BankLoanGuru home page displays a Finance menu and customers can choose the debit cards option under the ĎCardsí drop-down menu. Users will be then taken to a page containing links to specific debit card and credit card pages. Clicking on the debit card link will take them to an info page on debit cards. BankLoanGuru customers can understand what each card offers and select the card they want. Clicking on ĎApply nowí will submit the customerís application to BankLoanGuru and they will receive an immediate e-approval via email. Their application will then be forwarded to the bank for further processing.
The Reserve Bank of India has made an amendment to the Merchant Discount Rate (MDR) that would be effective from 1 January 2018. For those that do not know, the Merchant Discount Rate is the amount the vendor/merchant has to pay the card associate (Visa, Mastercard, etc.) for every transaction. As per the new change, the MDR will now be based on the turnover of the merchant/company rather than the current slab-based structure. The MDR is applicable not only for transactions at POS terminals but also for online transactions and QR-based transactions. As already mentioned, merchants/vendors/companies will be charged based on their turnover for the year and are segregated into two categories - merchants with a turnover up to Rs.20 lakh and merchants with a turnover more than Rs.20 lakh. For merchants with a turnover (previous financial year) up to Rs.20 lakh, a limit of 0.40% or Rs.200 will be charged for transactions online or at POS terminals. For QR-Based transactions, the MDR will be capped to a maximum of 0.30% of the transaction or Rs.200. For merchants with a turnover (previous financial year) more than Rs.20 lakh, the applicable MDR for transactions made at POS terminals or online will be limited to 0.90% or Rs.1,000. For QR-based transactions, the MDR will be capped at 0.80% or Rs.1,000 per transaction.
|Merchant Category||Merchant Discount Rate (MDR) for debit card transactions|
|For POS Terminal and Online Transactions||For QR-Based Transactions|
|Merchants with a turnover up to Rs.20 lakh (based on previous financial year)||Limited to 0.40% or Rs.200 (per transaction)||Limited to 0.30% or Rs.200 (per transaction)|
|Merchants with a turnover above Rs.20 lakh (based on previous financial year)||Limited to 0.90% or Rs.1,000 (per transaction)||Limited to 0.80% or Rs.1,000 (per transaction)|
ATM cards, debit cards, and credit cards are payment cards issued by a bank which allow customers to perform certain specific transactions. Not only does it make your purchases smooth and convenient, but some retailers require it for billing purposes. Banks these days are trying to add more value to the services offered by them and hence the cards come with a lot of offers and discounts. The most striking feature of card transactions is that it is secure and it reduces the need to carry hard cash. Given below are some of the main differences between an ATM card, debit card, and a credit card.
Most individuals with ATM cards usually use ATM machines for the sole purpose of withdrawing cash. However, ATM machines perform other functions as well. They include:
Payment of Utility Bills
ATMs can be used to make payments for utilities such as electricity, insurance premiums, and telephone providers. However, these payments can be done only if the bills have not crossed their due dates.
Requesting a cheque book
Cardholders can make requests for a new cheque book through the ATM owned by his/her bank. One thing to remember when making a request for a new cheque book is that the address provided to the bank is updated.
Making credit card payments
Most ATMs have an option for paying credit card bills. However, it is essential that the payment is made at the ATM that is owned by the bank where the credit card was issued.
Cardholders will have to register for the service of making their tax payments at an ATM. However, this service is only available for payment of direct taxes. After a cardholder has registered for the service, the amount payable will be debited from the card holderís account. Once debited, the cardholder receives a Special Item Number (SIN) that should be added as a reference when filing taxes.
Recharging mobile phones
Cardholders can use their debit card to recharge their pre-paid mobile numbers. This can be done by visiting the ATM owned by the card holderís bank. The process would require the cardholder to enter their mobile number and their ATM PIN to confirm and authenticate the transaction.
In a survey conducted in 2015, it was revealed that there were around 61.5 crore debit card users and 2.3 crore credit card users in the country. Generally, customers pay a transaction cost on debit card payments which is also known as merchant discount rate (MDR). In a move to increase cashless transactions post demonetization, the government had notified banks to not charge customers for debit card transactions till December 31.
As per RBI guidelines, banks issuing the debit cards are responsible for keeping the information of their customers safe. But there have been multiple instances of data breaches due to negligence on the part of debit card users as well. Listed below are some of the dos and doníts for first-time users of a debit card.
With advancements in technology in the banking sector, it has become easier for people to carry out a number of banking transactions with the touch of a few buttons. Almost all banks these days offer internet banking facilities to help customers transfer funds to other bank accounts instantly. For those individuals who do not use their bankís internet banking facilities, funds transfers can also be carried out using their debit cards.
While this facility is not available for all bank debit cards, but most of the popular banks do offer this facility to their customers. Money transfers can be made through ATMs using a debit card by following the steps listed below:
Funds transferred through an ATM card are credited instantly to the beneficiaryís account.
There are a number of banks in India that offer rewards on their debit cards in the form of cashback. The cashback can be redeemed by the customer and used for future purchases. Different banks offer a wide variety of debit cards. The reward system is generally based on the type of the debit card. Banks often tie up with different retailers for a period of time. Customers are eligible to receive cashback (occasionally other rewards) on the purchase of goods and/or services from these sellers. For example, consider the Big Billion Day sale by Flipkart or The Great Indian Sale by Amazon. During these sales, banks tie up with the seller companies to offer rewards to the debit card and/or credit card users. These rewards are often given in the form of cashback or additional discounts. The discount or cashback is often quite lucrative.
The process is quite simple. The card companies like VISA, American Express, MasterCard, Maestro, RuPay, etc. earn a certain percentage in the form of commission every time a transaction is made using their cards. On the successful completion of a transaction, a certain part of the transaction amount goes to these card companies. Out of these commissions, the card companies make a small payment to the banks. The banks utilise a small percentage of this amount to provide reward points or cashback to their customers. This is done by the banks with the sole purpose of giving an edge to their products.
Some of the banks in India that provide great cashback offers and reward point systems on their debit cards are The State Bank of India (SBI), ICICI Bank, and HDFC Bank. There are a number of other banks as well, both public and private, that are constantly coming up with new cards and new offers on their debit cards.
EMV is the acronym for Europay, MasterCard, and Visa. They are the original card schemes that developed the EMV technology jointly. It serves as the international standard for debit and credit card transactions that are based on chips. EMV was developed to ensure that the card transactions are secure and the cards can be accepted globally.
The EMV Chip Cards come with a magnetic strip as well as a microchip. The chip cards are more secured as it is very difficult to counterfeit a chip card. You might be familiar with the frauds that have taken place in numerous instances with a magnetic strip card. EMV chips curb that problem to a huge extent. Moreover, the chip cards help the issuer of the cards to get complete information about the payment history of the users. As the cards use a point-to-point encryption for the transactions, the data is highly protected. This feature is not a standard for the EMV module, however, most of the new EMV terminals come with this technology. The data of the transactions of the card are transmitted in encrypted formats, making the transactions highly secure.
Unlike the cards with just a magnetic strip, the EMV chip cards follow a much more secure format of completing transactions. A typical chip card will follow the steps mentioned below to complete a transaction:
The EMV Chip Cards cannot be misused as each transaction generates an unique code. The EMV chips also make it easier for the algorithms of credit cards to identify the activities which are fraud in nature.
As per the norms of the Reserve Bank of India (RBI), transactions which do not cross the mark of Rs.2,000 can be processed without using a PIN. Reports also provide the statistics that in India more than 60% of the financial transactions are below the mark of Rs.2,000. This is where the NFC cards or Contactless cards enter the scene. NFC stands for Near Field Communication. The principle of NFC is applicable for the contactless cards. A contact is established using radio transmission when an NFC-enabled card is waved near a POS terminal. This process does not require the user to swipe the card and enter the PIN. The transaction can be completed just by waving the card.
Both VISA and MasterCard have rolled out this feature and quite a number of banks are offering the feature on their debit cards and credit cards. If your VISA card has payWave written on it, you can use the card for contactless transactions. In the case of MasterCard, the cards have PayPass written on them.
IRCTC RuPay debit card was launched by the National Payment Corporation of India (NPCI) and it comes as an additional unit to augment the system of cashless transactions. It functions much like the Visa card or MasterCard and offers both virtual and physical options to cardholders. The card can be used exclusively for booking train tickets through the IRCTC portal. Itís the first payment gateway system ever launched in India. Hereís a listing of some of the key features and benefits of the IRCTC RuPay prepaid card:
There are two options available on the card namely Virtual card and Physical card. The Virtual card requires only partial completion of KYC details and the transaction limit offered on the cards is Rs.10,000. It comes with a 1-year validity. Even for a physical card, the max card limit is Rs.10,000 with partial KYC details but with the completion of KYC, the limit can be extended to Rs.50,000. The Virtual card comes for free whereas the physical card will be sent to your registered address for a nominal fee of Rs.50. The Virtual card credentials are sent to the applicantís email address which can be used at the time of booking tickets.
Add-ons with Rupay Debit Card
IRCTC has tied up with various brands such as Amazon, BookMyTrain.com, Jubilant Foodworks, etc., to provide more exciting offers on the card. For example, passengers can use the card to order a pizza at some selected stations. The scope of the card is yet to be determined as the government is working out ways to enhance the range of activities it covers. It is likely to be linked with e-catering, tourism, archaeological websites, etc.
Indian consumers can choose from a wide range of debit cards offered by various Indian banks which are made to suit their banking requirements. The list of banks are as follows: