These provide convenience and flexibility to customers as they need just one card for all their financial requirements. These cards are available from Union Bank of India along with IndusInd bank as of now.

How does this work?

These Debit-cum-credit cards look similar to any debit/credit card but with advanced technology. It has two chips on the front along with two magnetic strips at the back. One of the chips is responsible for payments made by debit card. Another chip is responsible for payments made by credit card. Further, both of these chips are placed on either end of the card. Another benefit from this card its customers can derive consolidated benefits from this card. The rewards points are stored in one account itself which provides convenience at its best.

Key features on these cards

 2 in 1:

 As we all know now, these cards can work in two ways, a debit card and as a credit card. It helps you get away from the hassle of carrying multiple cards while going on shopping, movies or other scenarios. All you need is a single card which will help you with all your financial needs.

No joining or processing fees:

Another feature of these debit-cum-credit cards is that the banks don’t charge you fees on signing up for the card. Also, they don’t charge while processing transactions. Banks provide these cards for no charges in the beginning; this might vary from bank to bank.

Low-interest rates:

The banks charge a lower interest rate on utilized credit which is also known as the overdrawn amount. When compared to the rates of interest charged in case of regular credit cards.

No charges on ATM withdrawals:

Unlike normal credit cards, these debit-cum-credit cards have no charge from withdrawals from Automated Teller Machines.

Ease in monitoring:

While using normal cards, it often becomes a pain to go through multiple account statements. It makes it difficult when trying to find a particular transaction. (Especially when you fail to remember which card you used debit-cum-credit card generates a single account statement at the end for each month. This helps the customers to keep a track of their expenses of both, the debit card as well as the credit card.

Other benefits:

Like usual credit cards, these cards come with various offers and benefits including reward points. Which are credited into the account on spending, insurance benefits to the account holder, discounts, cash-backs etc.

Limitations

The idea of using one card instead of two sounds very easy and convenient but it has got its drawbacks as well. For example- A customer is using 2 cards, to get rid of the problems of using multiple cards, applies for a debit-cum-credit card. after receiving the card, the customer sets the same password for both as it would be convenient and the idea also sounds rational. While withdrawing money from the account, if the customer accidentally withdraws money from the credit side while thinking he/she is using their debit card might land them in complications. Their account statements will show a debit balance.

This doesn’t sound like a big problem but not only the banks will charge interest on this amount but also this would have an adverse impact on the credit score of the customer. This may further cause problems in the future if a customer wishes to buy something on the basis of EMI or apply for a loan.

Drawbacks:

There is a high percentage of chance that customers may make mistakes such as swiping or dipping the wrong end of the cards. In addition to this issue, it is to be noted that not all the times the customers are in charge. This error can happen from waiters in restaurants, merchants, cashiers at a departmental store, etc. as the magnetic strips and on both the sides of the cards. Another problem is when you lose it. Instead of one, you lose two cards at once, you will lose access to your credit limit as well as your savings. Cash would be the only solution left to you that too if you have any. Although this problem can be tackled using 2 different passwords, it is unlikely that many will resort to this solution as remembering multiple passwords can be tough along with passwords of multiple websites and accounts.

The conclusion

Debit-cum-credit cards provide ease, convenience, and flexibility by combining two cards in one. it comes with benefits such as single account statement for ease, low-interest rates compared to normal cards, no initial or processing fees, reward points, etc. however, The chances of error while using such 2 in 1 is very high. It looks like just another debit/credit card,  so you are bound to use it by the wrong side if you aren’t careful. So if you are someone who can be cautious and alert while using such type of a card every time. There is no downside for this card for you and you shouldn’t hesitate to apply for it. 

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