There are a number of accounts that now carry attached debit cards but which are not transaction accounts. While transaction accounts are the traditional ones for debit card issuance, modern economic realities mean they are now issued on a wide range of accounts that did not traditionally offer easy access to the deposited funds.

Because transaction accounts are the ones most people utilise for deposits and payments on a daily basis, there tends to be a large flow of money into and out of these accounts. For that reason, banks tend to charge a monthly fee for transaction accounts and pay little or no interest on the balance of deposits.

Debit cards act in many ways like cheques and so they were associated with transaction accounts. However debit card transactions are processed differently than cheques, through the clearing systems of Visa or MasterCard, or through the EFTPOS system. The credit card clearinghouses charge a fee to the merchant for processing the transaction, whereas the EFTPOS system may charge the debit card holder. In return for the fee paid, the merchant gets a fast payment, and there’s also a tendency for the customer to spend more money than they would if they were limited to cash.

This meant that debit cards were actually free at the point of use for banks, credit unions, and building societies. In fact in some cases a slight profit was made on the cards. This also meant that they were able to start offering these cards to people with accounts that did not traditionally have associated debit cards.

Savings accounts were one of the first types of non-transaction accounts to be issued debit cards. Not all savings accounts have debit cards, particularly those savings accounts that include a penalty for early withdrawals. One surprising type of savings account that can have a debit card is an investment account, which is a cash account with a trading brokerage such as a stock broker. A debit card associated with such an account allows the investor to withdraw profits from the account as part of their income stream.

Loan accounts of various kinds can also have debit cards. This can include lines of credit and home loans. The home loans that have a debit card tend to be flexible home loans where a certain amount of overpayment is allowed into an offset account, and so the debit card will access this offset account.