Most debit cards can be used on Automatic Teller Machines, also known as ATMs
Debit cards in general have a greater number of uses than a credit card. Debit cards are usually the main bank cards on an everyday account, which means that they are used as the ATM card, the debit card, the EFTPOS card and the cheque card.
Some cards do not combine all these functions, due to limitations in technology. In these cases supplemental cards are issued which carry out some of the other functions. In these cases it is important for the card user to ensure that they are carrying both sets of cards.
As with all ATM cards, inter bank charges apply when using debit cards in machines used by other banks. Inter bank charges are usually similar to EFTPOS charges, although some ATMs that are not run by a bank can charge quite high fees for accessing money. Some debit cards with banks with smaller branch networks, such as ING, will offer to refund large withdrawals in an effort both to lose the competitive disadvantage of having a small branch and ATM network as well as encouraging customers to take out larger amounts on each visit.
One advantage that debit cards have over credit cards is that cash advances on credit cards can be very expensive. This is because they tend to have higher interest rates, they do not have the interest free grace periods that purchases have and they are paid off last when repayments are made. This means that withdrawing cash even when this takes an everyday account into overdraft can be cheaper than withdrawing cash on a cash machine using a credit card. However if there is a chance of sending the account into an overdraft situation it is a good use of time to phone up the bank in advance in order to arrange a credit line as an unauthorised overdraft can be expensive in both fees and interest rates.
If debit cards are used in foreign ATMs then it could be subject to overseas charges. This takes two shapes, firstly through an overseas use charge and secondly through an exchange rate that may be less advantageous than a local bureau de change.
One of the complaints about using ATMs has been the difficulty in remembering the pin number. Debit cards will have an advantage over credit cards in this respect as the growing use of chip and pin, where pin numbers are necessary to purchase a good. In most cases this will be the same as the number used in the ATM.
