Credit vs. Debit Card
What Is a Credit Card? A credit card is a card associated with a revolving line of credit. These cards allow cardholders to make payments using borrowed funds. Most financial institutions, including banks, issue credit cards to eligible consumers. The individual accounts associated with credit cards come with a maximum credit limit. However, in many cases, good payment whatsmind behavior can result in a limit increase. Either way, this limit is the total amount of revolving credit you can borrow to pay for goods and services. Revolving credit, in turn, refers to an open-ended credit account. It means it doesn’t have an end date, so you can use the available funds so long as that account remains open. Each time you use a credit card, your available credit decreases based on the cost of the charge you made. For example, suppose you bought a pair of shoes that cost $50 and charged it to your card. If your card’s available credit was $1,000 before the purchase, then it will go down to