Cards are now one of the most widely used payment methods in the modern day. In fact, debit card payments alone overtook cash payments in terms of volume last year, showing just how popular they have become.

There are now many different options on the table when it comes to bank cards, with each offering its own unique set of advantages and drawbacks. From debit cards to prepaid cards, there is plenty to consider when it comes to choosing one, so here is a breakdown of each type of card.

Debit Cards

The most basic type of bank card, debit cards can be used to access the owner’s bank account, whether at a cashpoint, in a shop, or when paying for something online. There is usually no fee when paying with a debit card, and they all have security features (like a pin number).

Many debit cards now also include a limited contactless feature (for purchases under £30), which allows for much faster transactions. For those who are looking to stay out of debt and simply access their own money, then it is perfectly possible to survive with a debit card alone.

Credit Cards

Similar to debit cards, credit cards offer quick and easy access to money, and can be used in shops, online and at cashpoints. However, the most significant difference is that it is not your money which you will be spending when you use a credit card.

Instead, it is the provider’s money which they have loaned to you in the form of credit. Each card will have a limit on how much you can spend with it (like £1000), and the money will need to be paid back, potentially with fairly significant interest (and many companies/cashpoints also include surcharges for using a credit card). As such, they should really be reserved for emergencies, and you will also need a good credit score to be accepted for one.

Prepaid Cards

Prepaid cards are similar to debit cards in some ways. They involve putting money directly onto the card through a bank holding company (as opposed to putting it directly into a bank account), which can then be spent in the same way as a debit card.

This is especially useful to those who either do not trust the banking system or are locked out of the system altogether. In essence, prepaid cards are almost like electronic cash, providing the same benefits of carrying cash with added security and less reliance on cashpoints. They are certainly becoming more popular, and could well be more widely used in the next few years given the unique set of advantages they offer.

These form the main set of options available to the average person when choosing a bank card. Nearly everyone with a bank account will likely have a debit card, but credit cards and prepaid cards are completely optional, so it is really down to the individual to decide whether they may find one useful.