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A credit card can be a useful tool for managing your money. But before tapping into the benefits, the first thing to know is how to get a credit card. There are some requirements, and some tips that can help when it comes to getting approved.

Here’s the lowdown on the key things to know to apply for a credit card — and most importantly, to get approved for a credit card.

What to Consider When Applying for a Credit Card

Before you worry about how to get a credit card, it’s helpful to first understand what a credit card is. As the first word in its name suggests, a credit card is a line of credit, which is a type of flexible loan that enables you to borrow money up to a fixed limit.

When an individual charges a transaction at a business that accepts credit card payments, the credit card company pays the merchant. The cardholder must then pay back the credit card company by a designated date. Otherwise, they’ll incur interest charges.

This basic premise of how credit cards work means the card company is taking a risk when extending credit to any individual. They assess that risk via an application that determines not only whether the individual gets approved for a credit card, but also factors like their credit card limit and annual percentage rate (APR) on a credit card.

Before applying, there are some important considerations that can help improve your chances of getting approved for a credit card.

Recommended: Tips for Using a Credit Card Responsibly

Learn About the Terms Associated with Your Credit Card

Evaluating different credit cards can feel overwhelming for a newbie, so it’s a good idea to get familiar with some basic credit card terms that are common across all credit cards. Here are some common terms you might run into in a credit card application and as you begin to use your new card:

•   Balance: Your balance is the amount of money you owe on your credit card. This can include purchases (even paying taxes with credit card) as well as any fees, balance transfers, and cash advances.

•   Balance transfer: A balance transfer is when you move money from one credit card to another credit card, ideally one with a lower APR. This can allow you to pay off your debt more easily, though you’ll often pay a balance transfer fee to move over the balance.

•   Billing cycle: A credit card billing cycle is the period of time between the regular statements you receive from your credit card company. Usually, billing cycles occur on a monthly basis.

•   CVV: The card verification value, or CVV number on a credit card, is a three- to four-digit number that appears on a physical credit card. It serves as an additional layer of security in transactions that occur over the phone or online.

•   Expiration date: A credit card expiration date represents when a credit card is valid until. Usually shown as a month and a year, you can use your credit card up until the last date of that month in that year.

•   Late fee: The late fee is a charge you’ll incur if you miss making at least your minimum payment by your payment due date. To avoid this fee, it’s important to alway pay on time, even if you’re in the midst of disputing a credit card charge, for instance.

•   Minimum payment: The credit card minimum payment is the least amount you must pay each month on your outstanding balance. This can be a flat amount or a percentage of your outstanding balance.

•   Purchase APR: The APR for purchases represents the total annual cost of borrowing money through purchases made with your credit card. This APR applies only on remaining balances after the statement due date.

Decide on the Type of Credit Card You Need

There are a number of different types of credit cards out there that can serve different needs. For instance, there are:

•   Travel rewards credit cards

•   Cashback credit cards

•   Credit-building credit cards

•   Balance transfer credit cards

While most of the above types of cards are unsecured credit cards, meaning no deposit is required, there are also secured credit cards. These do require a deposit, though they may also be more accessible to those with limited or low credit.

Different types of cards offer different benefits, and they may also vary when it comes to things like annual fees or average credit card limits.

There may also be differences in the requirements for getting approved. It’s not so much a question of how old you have to be to get a credit card — rather, different cards may have varying requirements for minimum income or credit score needed to qualify.

Before applying, it’s a good idea to do some comparison shopping to find a card that not only fits your needs but also that you’re eligible for.

Check Your Credit Score

Your credit score is a number that indicates the likelihood that you’ll repay a debt. It’s based on your credit history, and banks use it as a tool for evaluating credit card applications and deciding whether to approve them.

Here are some common factors that can affect your credit score:

•   Payment history, including on-time payments, missed payments, and having an account sent to collections

•   Credit utilization, or how much one owes relative to their total available revolving credit

•   Length of credit history

•   Types of credit accounts

•   Recent activity, such as applying for or opening new accounts

Generally, the higher an individual’s credit score, the more creditworthy they’re considered. If using the FICO scoring model, here’s a general breakdown of what various scores mean:

•   Less than 580: Poor

•   580-669: Fair

•   670-739: Good

•   740-799: Very good

•   800+: Exceptional

It’s a good idea for an individual to know their score and their chances of getting approved before applying for a credit card. The minimum credit score for a credit card will vary depending on the type of card it is.

For example, rewards credit cards, which come with big perks, tend to require a good credit score. But some types of credit cards, such as secured credit cards, may be more accessible to those with lower credit scores because they pose a lesser risk to lenders. This can make the latter category more appealing if, for instance, you’re getting your first credit card.

It’s worth noting that pulling one’s own credit information is considered a “soft inquiry” and does not reduce their credit score. When you apply for a new credit card, however, it will generate a “hard inquiry,” which can lower your credit score temporarily.

Where to Apply for a Credit Card

Credit cards are offered through banks, credit unions, retailers, airlines, colleges and universities, and a host of other institutions. This means that there are a variety of places where one can apply for a credit card — and often a number of ways to apply.

You can apply for a credit card in person, such as at a bank branch or retail location. Or, you may apply over the phone. Most credit card issuers also offer online applications, which add convenience to the process.

How to Apply for a Credit Card in 3 Steps

Ideally, by the time you sit down to actually apply for a credit card, you’ll have done the necessary homework to determine if you should get a credit card. This includes checking your credit score and potentially getting preapproved (though more on that later).

1. Gather the Necessary Information

The application process will be easier — and likely quicker — if you’re prepared. This means gathering any necessary documentation (more on what you’ll usually need in the next section) and having reverent information on hand, such as your income and Social Security number.

2. Fill Out and Submit an Application

Next, it’s time to fill out the application. There are a few ways you can do this: online, over the phone, or through the mail. It’s generally quickest to complete an application online.

You’ll need to fill in the requested fields and upload (or make copies of) any necessary documents. Once you submit your application, you should hear back within a few weeks at the most — sometimes, you’ll hear back almost the same day.

3. Be Ready for the Credit Impact and Repayment

As you wait for your credit card to arrive in the mail, you should take stock of the recent hit you took to your credit from the hard inquiry. It’s generally advised to avoid applying for multiple credit cards or loans within a short period of time to minimize the credit impact.

Also start to consider your strategy for how you’ll repay your credit card balance once you start swiping. Consider setting up automatic payments from your bank account each month to make sure you’re not late, or you might set a reminder on your phone or in your calendar.

What Do You Need to Apply for a Credit Card?

While application requirements will depend on the credit card issuer, what you need to apply for a credit card generally includes:

•   Annual income

•   Address and length of time at that address

•   Date of birth

•   Phone number

•   Social Security number

•   Employment status and sources of income

•   Financial accounts and/or assets

•   Financial liabilities

•   Country of citizenship and residence

Credit Card Preapproval and Prequalification

Getting prequalified or preapproved for a credit card means you’ve been prescreened for a credit card and meet at least some of the eligibility requirements. The two terms can be used interchangeably, though preapproval might carry slightly more weight in terms of your odds of eventual approval.

You’ll still need to go through the formal application to get approved for a credit card though, as neither preapproval or prequalification means you’ve been approved. The formal application process will involve a hard inquiry, whereas prequalification and preapproval generally only involve soft inquiries.

Still, preapproval or prequalification can be a good way to suss out potential credit card options and likelihood of getting approved before you move forward with an application and risk the impact to your credit.

What Happens If Your Application Is Turned Down?

Getting turned down for a credit card is indeed disappointing. When a credit card application is declined, you have the right to know why. You can request details about your application in the form of an adverse action letter, which includes the reason for the denial, details about your credit score, and notice of the right to dispute the accuracy of information provided by the credit reporting agency.

This can serve as helpful context for understanding why an application was declined. It can also help in determining what the appropriate next steps are for improving one’s chances of approval, if and when you apply for another credit card. For instance, you may consider applying for a credit card that has less stringent credit requirements, or you may take steps to improve your credit score and try again at a later date.

Secured and Prepaid Credit Cards

If you were turned down for a credit card, you might take some steps to improve your credit before trying again, or you might consider other options. Two alternatives you might look into are secured credit cards and prepaid credit cards.

With a secured credit card, you put down a deposit, which serves as collateral and usually acts as the card’s credit limit. Because there’s collateral there for the credit card issuer to fall back on if you fail to make your payments, secured credit cards are generally easier to get approved to than the more traditional, secured credit cards.

Prepaid debit cards don’t let you work on building your credit, as you’re not actually borrowing funds. Rather, you load the card with funds that you can then use in person or online. This can offer some of the convenience that a credit card offers over cash, without the application and approval process.

The Takeaway

Applying for a credit card can be a simple three-step process of gathering the required details, submitting an application, and handling the likely credit impact. You will probably have many options when selecting a card, so take your time to find the right fit.

Whether you're looking to build credit, apply for a new credit card, or save money with the cards you have, it's important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.

FAQ

How do I choose a credit card?

Choosing a credit card is a personal decision that depends on your needs, preferences, financial habits, and eligibility. Before applying for a credit card that appears to fit your needs, it’s a good idea to check your credit score and any other requirements, such as minimum income, to improve your chances of getting approved.

How long does it take to get a credit card?

The length of time it takes to get a credit card can depend on a number of factors, including the eligibility requirements and how an application is submitted. Some online credit card applications offer fast or even instant approval, although it can take some additional time for the credit card to arrive in the mail.

Does your credit get pulled when applying for a credit card?

Generally, a credit card company will do a hard credit inquiry before extending final approval. However, there may be some scenarios where a credit card issuer may only do a soft inquiry, such as if an individual has been preapproved for a credit card or already has a banking relationship with the credit card issuer.

What are the requirements needed to get a credit card?

The requirements to get a credit card will typically vary from card to card. However, you’ll generally need to provide information on your annual income, your employment status, and your current debt obligations. Your creditworthiness also comes into play, though credit score requirements will differ depending on the card.

Can you get a credit card with no credit history?

It is possible to get a credit card with no credit history, though your options may be more limited. You may have an easier time getting approved for a secured credit card or a basic, no-frills credit card.

Photo credit: iStock/Dome Studio

Checking Your Rates: To check the rates and terms you may qualify for, SoFi conducts a soft credit pull that will not affect your credit score. However, if you choose a product and continue your application, we will request your full credit report from one or more consumer reporting agencies, which is considered a hard credit pull and may affect your credit.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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So you want to go to medical school and become a doctor? Then you know that the MCAT, a rigorous test, is likely in your future. Since it’s an important qualifying test for medical school and can be challenging, you likely want to arm yourself with info and prepare well for it.

Here, you’ll learn some of the most important information, such as:

•   What are the MCATs

•   How to start studying for the MCATs

•   How to pay for the MCATs and medical school.

Read on, and hey: You’ve got this!

What Are the MCATs?

MCAT stands for Medical College Admission Test® (MCAT®). The test, which the Association of American Medical Colleges (AAMC) creates and administers every year, is multiple-choice and standardized. Some important facts:

•   Medical schools have been utilizing it for more than 90 years to determine which students should gain admission.

•   Most medical schools in the United States and some in Canada will require that students take the MCATs. Every year, more than 85,000 prospective medical school students take it.

•   There are four sections to the MCATs:

◦   Critical analysis and reasoning skills

◦   Biological and biochemical functions of living systems

◦   Chemical and physical foundations of biological systems

◦   Psychological, social, and biological foundations of behavior.

•   Students will receive five scores: one for each section, and then one total score.

◦   In each section, they can get a score ranging from 118 to 132, and the total score ranges from 472 to 528.

◦   Generally, a competitive MCAT score is a total of 511 or above, which would place a student in the 81st percentile.

The average MCAT score for all medical school applicants is currently 501.3. Usually, students will receive scores 30 to 35 days after they take the exam.

Keep in mind that MCAT scores, while important, are just one part of a medical school application. Medical schools often review other factors, including things like a student’s:

•   GPA

•   Undergraduate coursework

•   Experience related to the medical field, including research and volunteer work

•   Letters of recommendation

•   Extracurricular activities

•   Personal statement.

Because of this array of inputs, If a student has a high GPA from a competitive undergraduate school, for instance, and they don’t score very high on the MCATs, they may still have a chance of getting into a medical school.

Getting a competitive score on the MCAT can give applicants an edge, especially when applying to ultra-competitive medical schools. One way students can help improve their chances of getting a desirable score on the MCAT is to learn how to study for the unique demands of this test.


💡 Quick Tip: Ready to refinance your student loan? You could save thousands.

Studying for the MCAT

One of the first things a student can do when determining how to prepare for the MCAT is to create a study plan. A well-crafted study plan will review what materials the student should review in order to prepare for the exam.

That said, there’s no one best way to prep for the MCAT. Consider these options; you might use one or a variety of techniques.

The AAMC Website

One great place to get started is the AAMC website, which provides an in-depth outline of the test on their website. Obviously, the same questions students will see on the actual exam won’t be listed, but sample questions that are similar to the real questions are. Students may find helpful tutorials and other content as well.

Online Resources

There are a variety of other online resources students can explore to help them review. For example, the AAMC currently recommends students take a look at Khan Academy’s MCAT Video Collection, where there are more than 1,000 videos as well as thousands of questions that students can use to review.

There are also MCAT study apps like MCAT Prep from Varsity Tutors and MCAT Prep by Magoosh that students can download and use to study.

Books, Textbooks, and Class Resources

How else to prep for the MCATs? It may also help to buy or borrow books from the library that go into detail on the MCAT. One word of advice: Students should just make sure that the books they’re reading are up to date. Information (and the MCAT) get refreshed often; you don’t want to be studying yesterday’s medical data.

It can also be helpful to review class notes and study guides from courses you’ve taken that are related to MCAT materials. Some schools have study groups and other academic support resources for students who are studying for the MCAT. If you’re currently enrolled in classes, take a look to see what might be offered at your campus. You might luck out with some great ways to learn more.

Practice Tests

AAMC offers official sample MCAT practice exams online. You can access two for free, and others for a cost of $35 each. Taking practice tests can help students familiarize themselves with the exam. Taking practice tests can also be important in helping students understand the timing of each section.

Study Groups and Tutors

Here are other ideas for how to start studying for the MCAT:

•   Getting an MCAT tutor who has taken the test could also be helpful. A tutor will generally be able to provide guidance on what kind of questions a student can expect. Plus, they will likely have hands-on experience with effective methods and tips for studying.

If you decide that how to prep for the MCAT should involve a tutor, ask friends and fellow students who have taken the MCATs recently for recommendations. There are also test preparation companies that provide resources for students to find tutors online or in person. Do check reviews and references.

•   Study groups can also be a tool to help students who are preparing for the MCATs. Students can find others who are on the same path and work together to build proficiency. If possible, find a group where each student has a different strength and weakness. This can maximize students learning from one another.

•   It may help to use a shared calendar or another tool to make sure everyone is on the same page for dates, times, and locations for when the study group will meet.

•   Want to find a study group as part of how to prepare for the MCATs? Search engines, professors’ recommendations, school bulletin boards/online groups, and fellow students are good bets.

💡 Quick Tip: Refinancing could be a great choice for working graduates who have higher-interest graduate PLUS loans, Direct Unsubsidized Loans, and/or private loans.

Important Dates to Keep in Mind

Now that you know the ins and outs of preparing for the MCAT, what about taking the test itself? Students can take the MCATs several times throughout the year, from late January through September. There are hundreds of test locations around the U.S. and Canada as well as select locations around the globe.

If a student’s preferred MCAT test date or location is not available, they can sign up for email notifications to see if it becomes available down the line.

Recommended: Refinancing Student Loans During Medical School

Paying for the MCATs and Medical School

As you explore the best way to prepare for the MCAT and plan your medical school journey, you’ll likely be keeping costs in mind. Here are details to note.

Paying for the MCATs

The registration fee for the MCAT exam is $330, and that includes distribution of scores. There may be additional fees for changes to a registration, a late registration, and for taking the test at international sites.

The AAMC does offer a Fee Assistance Program to students who are struggling to pay for the test and/or medical school applications. To be eligible for the Fee Assistance Program, students must meet the following eligibility requirements:

•   Be a US Citizen or Lawful Permanent Resident of the US.

•   Meet specific income guidelines for their family size.

Note that the Fee Assistance Program will review financial information of the student and the student’s parents, even if the student is considered independent.

Keep in mind that along with the MCAT fee, applying to medical school can be quite expensive. Most medical schools in the US utilize the AAMC’s American Medical College Application Service® (AMCAS®). To apply to medical schools, students will generally pay a first-time application fee of $170, as well as $40 for each additional school.

Some medical schools may require a secondary application, and those fees range depending on the school. Students may also need additional money to travel to and tour schools.

Recommended: Cash Course: A Student Guide to Money

Medical School Costs

The application process is just one portion of the expense of med school. After being accepted, there’s the cost of tuition, books, and more, and these medical school costs have been rising steeply lately.

•   The average cost of the first year of medical school at a public school with in-state tuition is $67,641, which includes tuition, fees, and living expenses.

•   The average cost for the first-year at a private medical school is $93,186. The average debt for medical school graduates is currently $202,453. Debt after medical school can go even higher when you add in undergraduate loans.

Obviously, that’s a significant number and can make you wonder how to pay for medical school. First, do remember that medical school is a path to a rewarding and challenging career, as well as potentially a lucrative one. The average medical school graduate earns more than $150,000, with high earners enjoying salaries above the $400K mark, according to ZipRecruiter data.

Paying for School with the Help of SoFi

Paying for the MCATs and medical school can be a challenge. SoFi understands this, which is why they offer students private student loans and the opportunity to refinance their current student loans.

Keep in mind, however, that if you refinance with an extended term, you may pay more interest over the life of the loan. Also note that refinancing federal student loans means forfeiting their benefits and protections, so it may not be the right choice for everyone.

Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.

SoFi Student Loan Refinance
SoFi Student Loans are originated by SoFi Bank, N.A. Member FDIC. NMLS #696891. (www.nmlsconsumeraccess.org). SoFi Student Loan Refinance Loans are private loans and do not have the same repayment options that the federal loan program offers, or may become available, such as Public Service Loan Forgiveness, Income-Based Repayment, Income-Contingent Repayment, PAYE or SAVE. Additional terms and conditions apply. Lowest rates reserved for the most creditworthy borrowers. For additional product-specific legal and licensing information, see SoFi.com/legal.

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You may have a debit card in your wallet and even swipe it multiple times a day. But did you ever take a moment to think about what an impressive invention that little rectangle of plastic actually is?

Debit cards offer an extremely convenient payment method (you may not even need to swipe it in this tap-and-go era) and are a relatively recent addition to banking services.

To learn more about these handy payment cards, keep reading for 21 debit card facts.

21 Interesting Debit Card Facts

Want to learn some interesting facts about debit cards? These are debit card facts that may surprise you.

1. Over 80% of Americans Have a Debit Card

Recent surveys reveal that over 83% of Americans have a debit card. That’s a lot of plastic! Many people have multiple debit cards. One report noted that there were over 6 billion debit cards in the U.S.

2. Most Debit Cards Have a Familiar Logo

Many debit cards feature the Mastercard or Visa logo, even if your bank sends you the card. This means those two familiar card issuers’ networks can help support the transaction.

Over 73% of Americans have a debit card from Visa; almost 60% have one from Mastercard. (Yes, those numbers add up to more than 100%, indicating that many people have multiple cards.)

3. Debit Cards Followed Store Credit

Who came up with the ingenious idea for a debit card? Store cards likely sparked the idea. Before debit and credit cards launched, if someone didn’t want to make payments in cash (or couldn’t afford to), they often had the option to use store credit. U.S. banks actually got the idea for debit cards from the store credit system in the 1940s.

Quick Money Tip: If you’re saving for a short-term goal — whether it’s a vacation, a wedding, or the down payment on a house — consider opening a high-yield savings account. The higher APY that you’ll earn will help your money grow faster, but the funds stay liquid, so they are easy to access when you reach your goal.

4. Magnetic Stripes Debuted in 1967

Magnetic stripes quickly became the preferred method for making plastic cards machine-readable in 1967. In early 1971, the American Bankers Association (ABA) endorsed the magnetic stripe — also known as the magstripe — to make plastic debit cards readable on a machine. This helped usher in a new era of convenience, although debit cards were originally better suited for withdrawing cash from an ATM than shopping.

5. Magnetic Stripes Are on the Decline

Nowadays, magnetic stripes are becoming less popular as new technologies evolve. By 2033, Mastercard doesn’t plan to use magnetic stripes on their debit or credit cards at all anymore.

6. Kids Can Get Debit Cards

While 18 is usually the minimum age to open a bank account, some kids’ accounts come with debit cards. Chase offers a First Banking account with a debit card for those ages six to 17, and Greenlight and GoHenry also offer debit cards for young customers.

7. Metal Debit Cards Exist

While many of us are accustomed to plastic debit cards, some issuers make them out of metal. For instance, N26, an online bank overseas, offers premium banking clients a card made of 18 grams of stainless steel, in three different metallic shades.

8. Some Debit Cards Are Going Green

Starting in 2023, Bank of America is beginning to use recycled plastic for all of its debit and credit cards. This move is aimed to help reduce the amount of single-use plastics by 235 tons. It’s a good example of green banking at work.

9. Most People Have Daily Debit-Card Spending Limits

There may be exceptions to the rule, but most debit cards come with limits about how much you can swipe per day. These limits are typically between $400 and $25,000 per day. Check your agreement with your bank to find your financial ceiling.

Recommended: Guide to Paying Credit Cards With a Debit Card

10. The Public Resisted Debit Cards Initially

At first, people said a big “thanks, but no thanks” to debit cards. In 1972, a report commissioned by the Federal Reserve Bank in Atlanta found that the majority of the public didn’t support any kind of electronic payments system. Times have certainly changed.

11. You Can Customize the Photo on Your Debit Card

Do you like expressing yourself? Some financial institutions will let you put the photo of your choice on your debit card. For instance, Bank of America shows an example of putting an image of a furbaby on their debit card.

12. A West Coast Bank Released the First Debit Card

Debit cards made their debut in 1978, thanks to the First National Bank of Seattle. However, some say an early forerunner was introduced in the 1960s by the Bank of Delaware and should get credit as the true pioneer. Either way, it shows debit cards have been around for a while.

13. Debit Cards May Carry Fees

While you won’t rack up debt and charges the way you could with a credit card, not all debit card transactions are free. For instance, if you use your debit card to get cash at an out-of-network ATM, you might get hit with a charge. Or if you overdraw your account, you might get a fee similar to those incurred when you bounce a check. Check your account agreement or ask a bank rep for details.

14. UK Banned All Debit Card Surcharges

Originally, debit cards in the UK came with fees, such as processing charges. However, in 2018, the UK government banned any surcharges on debit cards which makes it possible to use them for a transaction of any size, even super small ones, without fees being added.

15. Chip Technology Leads to Contactless Payments

During the pandemic, contactless payments surged in popularity. This was made possible by chip technology. With chip technology, consumers can simply hold their debit card over a payment terminal to make a payment. There’s less risk of passing germs around via touch.

16. Chip Technology Doesn’t Require a PIN

Not only does chip technology make it possible to skip entering a debit card physically into the payment terminal, the use of a PIN may not be required.

17. You Can Be Liable for Charges on a Lost Debit Card

There’s a downside to the convenience of debit cards. If yours is lost or stolen, you’ll be liable for:

•   $0 if reported immediately and before any unauthorized charges are made

•   Up to $50 if you notify the bank within two days

•   Up to $500 if you notify the bank within 60 days after your statement was issued showing unauthorized usage

•   Unlimited if you don’t notify the bank within 60 days of the statement showing unauthorized usage being issued.

18. Some Debit Cards Can Be Used Worldwide

Having a debit card from a well-known issuer like Mastercard or Visa has some benefits. For example, because these two card issuers are so popular, they are accepted as a form of payment in most countries. This can make payments much easier for global travelers. That said, be wary of possible international conversion fees (possibly 1% to 3% of the amount you swipe) plus foreign ATM usage charges.

19. There Were Three Major Players Until 2002

Until 2002, there were three main players in the debit card space. Alongside Mastercard and Visa, Europay was the other big player. In 2002, Europay merged with Mastercard.

20. Debit Cards Are More Popular than Credit Cards

Consumers have the option to use debit cards or credit cards if they don’t want to have cash on them when shopping or if they are shopping online. In one recent study, debit cards were found to be used almost twice as often as credit cards.

21. People Spend Less With Debit Than Credit Cards

While people may use debit cards more often than credit cards, they tend to spend more when using credit cards (almost 30% more), whether purchasing in person or shopping online.

The Takeaway

There’s a whole array of interesting facts about debit cards, from how they were developed to how they are made to how they can be used. What may stand out most among these 21 debit card facts is just how far payment technology has come in recent years and how much more convenient purchasing has become.

FAQ

Are debit cards more popular than credit cards?

Debit cards tend to be more popular than credit cards. Recent research found that consumers use debit cards almost twice as much as credit cards. However, when they do use credit cards, consumers typically tend to spend almost 30% more than they do with a debit card.

What is the difference between debit and prepaid cards?

The main difference between debit and prepaid cards is where the funds for payment come from. A debit card is linked to a bank account, but a prepaid card is not. Consumers need to load money onto a prepaid card before they can use it. Once they do so, that amount acts as their spending limit.

What debit card is the most popular?

Most banks offer their own debit card, but the majority of these are backed by one of two issuers, Visa or Mastercard. Currently, Visa is the more popular issuer.

What debit card fact is the most useful?

The most useful debit card fact to know may be either that you have a daily spending limit or that you must report a lost or stolen debit card ASAP to avoid being liable for any unauthorized usage. The longer you wait, the more you might owe.

Photo credit: iStock/Daisy-Daisy

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SoFi members with direct deposit activity can earn 4.00% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 12/3/24. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

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