A STUDY ON DEBIT CARD

A STUDY ON DEBIT CARD

BACHELOR OF COMMERCE

OF

BANGALORE UNIVERSITY

SUBMITTED BY

PREETHAM GOWDA M.C

REG NO: 206CC41014

UNDER THE GUIDANCE OF

BHARATH .K

IN

VEIT DEGREE COLLEGE

SOUTHEND CIRCLE, JAYANAGAR 3 rd BLOCK

BANGALORE-560011

AUGUST: 2021-2022

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ACKNOWLEDGEMENT

This is to express my earnest gratitude and extreme joy at being

bestowed with an opportunity to get an interesting and information
project on “A STUDY ON DEBIT CARD”.

I would like to thank all the day, people who have helped me in
completion of the project, I would avail this opportunity to express my
profound gratitude and indebtedness to all those people.

Am extremely grateful to my project guide SIR BHARATH.K our

lecturer, who has given an opportunity to work on such an interesting
project. He proved to be an constant source of inspiration to me and
provided constructive comments on how to make this report/project
better. Credit goes to my friends whose constant encouragement kept
me in good stead.

Lastly without fail I would thank all my peers and college for providing
all explicit and implicit support to me during the course of my project.

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GUIDE CERTIFACATE
This is to certify that a mini project report on “A STUDY ON DEBIT CARD”
is completed under my guidance & supervision. It is submitted partial fulfillment
of requirement for the degree of bachelor of commerce, to VEIT DEGREE
COLLEGE (Bangalore University) by PREETHAM GOWDA M.C, bearing the
REG NO: 206CC41014 and this has not formed a base for the award of any
degree, diploma on fellowship by any other university or institution.

DATE:

PLACE:BANGALORE BHARATH.K

MCOM (FA)

Assistant professor

VEIT DEGREE COLLEGE

Jayanagar, Bangalore-560011

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INDEX
SL CONTENT PG
NO NO
1.1 INRODUCTION TO DEBIT CARD 05
1.2 DEFINATION OF THE DEBIT CARD 06
1.3 TYPES OF THE DEBIT CARDS 07

1.4 FEATURES OF THE DEBIT CARD 11

1.5 ADVANTAGES OF THE DEBIT 12

CARD

1.6 DISADVANTAGES OF THE DEBIT 15

CARD

1.7 DIFFERENCE BETWEEN THE 17

DEBIT CARD AND THE CREDIT
CARD
1.8 DEBIT CARD AROUND THE 18
WORLD.

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CHAPTER 1

A STUDY ON DEBIT CARD

1.1 INRODUCTION TO DEBIT CARD

The debit card and is considered safer than the magnetic cards. A debit card is a bank card
used to make payments from your own bank account. Debit cards were introduced in 1966
and have been around since. They are actually a linked to the card holders bank account. So
they basically provide an electronic access to the bank account of the cardholder.

Debit cards can be used to conduct online transactions. They can also be used at products or
services at the various point of sales. When you use a debit card it withdraws the balance
from your bank account, i.e. it debits your bank account. So if there is insufficient balance
in the account, the transaction will be unsuccessful.

Usually, there is a magnetic strip in the card that reads the debit cards information. But
recently due to security concerns, banks have started issuing chip debit cards. The computer
chip authenticated the debit card and is considered safer than the magnetic cards.

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1.2 DEFINATION OF THE DEBIT CARD

A debit card, also known as a check card, bank card, plastic card, or some other description,
is a payment card that can be used in place of cash to make purchases. It is similar to a credit
card, but unlike a credit card, the money for the purchase must be in the cardholder's bank
account at the time of a purchase and is immediately transferred directly from that account
to the merchant's account to pay for the purchase.

Some debit cards carry a stored value with which a payment is made (prepaid card), but most
relay a message to the cardholder's bank to withdraw funds from the cardholder's designated
bank account. In some cases, the payment card number is assigned exclusively for use on
the Internet and there is no physical card. This is referred to as a virtual card.

In many countries, the use of debit cards has become so widespread they have overtaken
cheques in volume, or have entirely replaced them; in some instances, debit cards have also
largely replaced cash transactions. The development of debit cards, unlike credit cards and
charge cards, has generally been country-specific, resulting in a number of different systems
around the world, which were often incompatible. Since the mid-2000s, a number of
initiatives have allowed debit cards issued in one country to be used in other countries and
allowed their use for internet and phone purchases.

Debit cards usually also allow an instant withdrawal of cash, acting as an ATM card for this
purpose. Merchants may also offer cashback facilities to customers, so that a customer can
withdraw cash along with their purchase. There are usually daily limits on the amount of
cash that can be withdrawn.

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1.3 TYPES OF THE DEBIT CARDS

There are currently three ways that debit card transactions are processed: EFTPOS, offline
debit, and the Electronic Purse Card System. One physical card can include the functions of
all three types, so that it can be used in a number of different circumstances.

The five major debit card networks are Union Pay, American Express, Discover, Master
card, and Visa. Other card networks are STAR, JCB, Pulse etc. There are many types of
debit cards, each accepted only within a particular country or region, for example Switch
(now: Maestro) and Solo in the United Kingdom, Interac in Canada, Carte Blue in France,
EC electronic cash (formerly Euro cheque) in Germany, Bancomat/PagoBancomat in Italy,
Union Pay in China, Ru Pay in India and EFTPOS cards in Australia and New Zealand.

The need for cross-border compatibility and the advent of the euro recently led[dubious –
discuss] to many of these card networks (such as Switzerland's "EC direct", Austria's
"Bankomatkasse", and Switch in the United Kingdom) being re-branded with the
internationally recognized Maestro logo, which is part of the Master card brand. Some debit
cards are dual branded with the logo of the (former) national card as well as Maestro (for
example, EC cards in Germany, Switch and Solo in the Pinpas cards in the Netherlands,
Ban contact cards in Belgium, etc.). The use of a debit card system allows operators to
package their product more effectively while monitoring customer spending.

1. VISA DEBIT CARD :

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A Visa Debit card works basically like a check. The amount of your purchase is deducted
directly from your checking account. You can use your Visa Debit card to: Place an order
online, by phone or mail.

2. MASTER CARD DEBIT CARD :

Debit Master card is a brand of debit card provided by Master card. They use the same
systems as standard Master card credit cards but they do not use a line of credit to the
customer, instead relying on funds that the customer has in their bank account.

3. RUPAY DEBIT CARD :

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Ru Pay issues debit cards in three variants – Ru Pay Classic, Ru Pay Platinum and Ru Pay
Select. Classic is the standard basic Ru Pay-branded card which offers minimum features
such as various merchant offers in categories like dining, travel, pharmacy, lifestyle,
cosmetics, retails, shopping, and jewelry. It does not offer benefits such as airport lounge
access.

Platinum is the middle tier offering from RuPay which provides all the features of Classic,
plus more offers and benefits such as airport lounge access, comprehensive insurance
coverage of up to 200,000 rupees, Amazon Pay offer, and various other merchant offers.

4. CONTACTLESS DEBIT CARD :

A contactless smart card is a contactless credential whose dimensions are credit-card size.
Its embedded integrated circuits can store data and communicate with a terminal via NFC.
Commonplace uses include transit tickets, bank cards and passports.

There are two broad categories of contactless smart cards. Memory cards contain non-
volatile memory storage components, and perhaps some specific security logic. Contactless
smart cards contain read-only RFID called CSN (Card Serial Number) or UID, and a re-
writeable smart card microchip that can be transcribed via radio waves.

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5. MASTRO DEBIT CARD.

Master card Maestro is a brand of debit cards and prepaid cards owned by Master card that
was introduced in 1991. Maestro debit cards are obtained from associate banks and are
linked to the cardholder's savings account, current account or any of several other types of
accounts, while prepaid cards do not require a bank account to operate. Maestro cards can
be used at point of sale (POS) and ATMs. Payments are made by swiping cards through
the payment terminal, insertion into a chip and PIN device or by a contactless reader. The
payment is authorized by the card issuer to ensure that the cardholder has sufficient funds in
their account to make the purchase. The cardholder then confirms the payment by either
signing the sales receipt or entering their 4- to 6-digit PIN, except with contactless
transactions below a specified amount for which no further verification is required.

Maestro often requires on-line electronic authorization for every transaction, although
Master card's rules permit the establishment of floor limits on Maestro EMV chip
transactions only. Not only must the information stored in either the chip or the magnetic
stripe be read, but this has to be sent from the merchant to the issuing bank, the issuing bank
then has to respond with an affirmative authorization. If the information is not read, the issuer
will decline the transaction, regardless of any disposable amount on the connected account,
except in the Asia Pacific region, where manual keyed entry is permitted under some
circumstances. This is different from most other debit and credit cards, where the

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information can be entered manually into the terminal (i.e. by typing the 13 to 19 digits and
the expiry date on the terminal) and still be approved by the issuer or stand-in processor. In
most countries, other than those specified in Master card's rules, a PIN rather than a signature
is always required to authorise a Maestro transaction, except where no CVM (Cardholder
Verification Method) is required.

Maestro is accepted at around fifteen million point of sale outlets in 93 countries.

1.4 FEATURES OF THE DEBIT CARD

1. Convenient:
By using a debit card, transactions are done instantly without the involvement of cash. It is
simple to use and makes transactions fast, easy and convenient.

2. Encourages Judicious Spending:

In debit cards, there is no feature of the credit facility; thus, this encourages judicious
spending.

3. Acts like an Emergency Fund:

A debit card can be used to withdraw money from an ATM, in case of an emergency. You
can shop at any store by using this card even though if you’re not carrying cash.

4. Visa or MasterCard:
The first things you'll observe is whether the debit card is Visa or MasterCard. This factor
doesn't much matter because both are accepted globally and consist some handy features.

5. Linked bank account:

Debit card is essentially used as a tool for spending own money, and for this reason, it will
be linked to a bank account.

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The funds in the account will be the funds you have available for spending. As the procedure
goes, you'll first open a bank account and then obtain a debit card; thus, it's your priority to
choose a good bank account. While choosing a bank account, the key factor to keep on mind
is to seek an account that has no monthly service fees. To get better interests on your funds,
always make sure to regularly transfer them to your savings account when you don't wish to
use them for spending.

6. ATM access:
Owning a debit card is a great handy tool to have since it provides you access to your cash
via ATMs. Every bank generally has an ATM network where you can access it for free while
using a debit card. They will also allow using other partnered banks' machines.

7. Pay Pass, pay Wave and other contactless payments:

In this modern banking system, contactless payment methods are on the rise, this includes
Pay Pass, pay Wave, and digital wallet technologies. Nowadays, banks are introducing debit
cards with the option of using at least one of these methods for making contactless payments
because they are quick and easy.

8. Overdrafts:
Debit cards can have overdraft options so that if you are running short of savings, you can
use this option to pay for the purchases.

1.5 ADVANTAGES OF THE DEBIT CARD.

1. Avoid fees and service charges :

Unlike credit cards, which often come with annual fees, late payment charges, substantial
foreign transaction fees of up to 3%, and other costly extras, debit cards typically have few
or no fees attached. If you use your debit card carefully, you can avoid incurring a fee
altogether.

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For example, some banks charge a few dollars (on top of the ATM’s fee) when you withdraw
cash from an unaffiliated ATM. But “ATM fees” are easy to dodge if you plan ahead. When
you know you’ll need cash, you can visit an in-network ATM to get it; or you can take
advantage of a store’s convenient “cash back” option when you pay with your debit card.

Since a debit card acts like an electronic check, taking money from your checking account
as you use it, you could incur an overdraft fee if you use your card when your account balance
is low or negative. However, this is another easy-to-avoid fee.

Many banks offer overdraft protection services ranging from lines of credit to rejecting your
card for insufficient funds so that you can’t accidentally overdraw your account. With online
and mobile banking, you can check your balance anywhere to make sure you have enough
money before using your debit card.

2 .Stay accountable for your spending:

Debit cards are also called “check cards” to convey their function as a plastic check. When
you charge a purchase on a credit card, you don’t actually have to pay for it until the next
month, and even then your minimum payment may be lower than the full balance.

In contrast, debit card purchases remove the money from your checking account right away
(if you select the debit option and enter your Personal Identification Number – PIN) or in a
day or two (if you choose the “credit” option).

Real-time payment holds you accountable to spend no more than you actually have. It’s
easier to make impulsive purchases with a credit card because you can have the item now
and worry about paying for it later.

3. Faster payments mean better budgeting :

Just as debit cards hold you accountable to spend responsibly, they also make it easier to
stick to a budget and resist overspending.

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If you write a paper check, it may not be cashed for days or even weeks.In the interim you
could spend more than you actually have, especially if you don’t perform a daily account
reconciliation. The faster, and in some cases instantaneous, payments linked to debit cards
make it clear how much money you have left. Debit cards work well with online and mobile
banking as well as budget management apps and websites because you can see your up-to-
the-minute balance and account activity in black and white.

4. No interest charges APRs on Credit Cards:

Perhaps the best reason to use a debit card instead of a credit card is interest. Credit cards
are known for charging high interest rates that can also fluctuate, usually in response to
changes in the Prime Rate. Annual percentage rates on credit cards range from 10% to as
high as 32.99% (if you end up with a penalty interest rate due to late payments). If you’re
not disciplined about paying the balance off every month, paying with credit cards will
usually hurt you financially. When you pay with a debit card, you avoid expensive interest
charges that end up greatly increasing the price of your original item.

5. Security:
If your wallet has ever been stolen, you know the painful truth that the cash is gone forever.
Debit cards protect against theft because no one can use your card at an ATM without
knowing the PIN. The recent addition of chips to debit cards offers further protection. Some
debit cards also offer security protection for online shopping so that only you can make
purchases with your card.

6. Debit cards are linked to interest-earning accounts:

Many banks offer multiple kinds of checking and savings accounts, including interest-
earning options. There’s usually a minimum daily balance required, but in return you get

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both the benefit of earning interest and the convenience of using a debit card for cash
withdrawal and purchases. Compounded monthly interest is like free money added to your
account balance that is accessible through your debit card.

7. Bank and Merchant Rewards:

Have you heard of rewards credit cards? Now some debit cards have joined the rewards
game. You can earn points for dollars spent and redeem your points for travel, shopping, or
gift cards. The rewards are typically for purchases made using your signature, not your PIN.
The process is the same as for credit cards but you benefit from no annual fee, no interest
charges, and all the other debit card perks we’ve just mentioned.

Merchants, on the other hand, prefer debit card transactions, especially the PIN entry
variety, because they pay less per swipe to banks than with credit cards. That’s why some
merchants encourage debit card payments, particularly those using a PIN.

8. Lower fees for tax payments with credit cards:

When it comes time to pay federal taxes, you can save on “convenience fees” if you pay with
a debit instead of a credit card. Of the IRS’s three payment processors, all charge a flat fee
of $2.25-$3.95 for debit card payments. For credit card payments, the fee is a percentage of
the total payment—from 1.87% to 2.00%—or a minimum fee that matches the debit card
flat fee. In this scenario, you’d pay at least the same amount in fees if you paid with a credit
card, but could potentially pay considerably more. For example, a person who owes $2250
in taxes on tax day would pay an additional $45 with a 2% fee.

1.6 DISADVANTAGES OF THE DEBIT CARD :

1. No credit allowed:
A debit card is linked to your bank account. There is no possibility of making any transaction
on credit. All transactions and withdrawals are limited to the balance available in your
account.

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2. Difficult to dispute fraudulent use:

It is easier to fraudulently use your debit card. In case someone steals the details of your
card, especially the PIN and CVV, the chances of a fraudulent transaction are very high.

3. Withdrawal Fees :

Banks charge consumers with processing fee on every transaction. These charges may seem
negligible to you, but the deducted amount can be surprising when considered as a whole. If
you use your ATM cum-debit card at an ATM not affiliated with your bank, it will cost you
more. Adding the annual maintenance fee and charges for SMS alerts/online banking would
be more troubling.

4. Doesn’t improve your credit score :

Since having a Debit card has nothing to do with your credit score, having loads of balance
in your checking account won’t help the damaged credit. By building your credit score,
you’ll have access to lower interest rates when borrowing and increased credit limits. A
credit card, on the other side, is a great tool to improve your credit score.

5. Withdrawal Limit is among common disadvantages of Debit cards

If you own a debit card, you might not feel as privileged as a credit card owner. In most
cases, the issuing banks limit the maximum withdrawal amount, and that’s applicable for
both cash and online transfer. This issue, at times, can be one of the leading disadvantages
of a debit card, if you’re away from your bank and the value of the amount required is
considerably high.

6. Unprotected against Frauds :

Credit/debit card fraud is everywhere and surprisingly, no one can stop it even after putting
the top-level security methods in place. The personal Identification Number (PIN) cannot

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give protection against identity theft. Anyone carrying the card can access the account if they
know your Debit card PIN. Most cybercriminals need your card details to get access to your
bank account. Other than that, a recent spike in ATM frauds and attacks during the pandemic
in Europe has raised the alarm of their use and ATM establishments.

7. Raising a complaint is a lengthy process :

Where it’s for cybercriminals to misuse your debit card online, even in case you notice it
happening, it’s a lengthy process to get the lost money. You’ll have to report the incident to
the bank. You are obligated to go through the inquiry process and explain the circumstances
under which it happened.

The process may take even days to resolve; the only way to retrieve the money is when the
bank believes it’s a genuine fraud case.

1.7 DIFFERENCE BETWEEN THE DEBIT CARD AND THE CREDIT

CARD:

 DEBIT CARD :

A debit card, also known as a check card, bank card, plastic card, or some other description,
is a payment card that can be used in place of cash to make purchases. It is similar to a credit
card, but unlike a credit card, the money for the purchase must be in the cardholder's bank
account at the time of a purchase and is immediately transferred directly from that account
to the merchant's account to pay for the purchase.

 CREDIT CARD :

A credit card is a payment card issued to users (cardholders) to enable the cardholder to pay
a merchant for goods and services based on the cardholder's accrued debt .The card issuer
creates a revolving account and grants a line of credit to the cardholder, from which the
cardholder can borrow money for payment to a merchant or as a cash advance. There are

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two credit card groups: consumer credit cards and business credit cards. Most cards are
plastic, but some are metal cards, and a few gemstone-encrusted metal cards.

1.8 DEBIT CARD AROUND THE WORLD.

In some countries, banks tend to levy a small fee for each debit card transaction. In other
countries (for example, the UK) the merchants bear all the costs and customers are not
charged. There are many people who routinely use debit cards for all transactions, no matter
how small. Some (small) retailers refuse to accept debit cards for small transactions, where
paying the transaction fee would absorb the profit margin on the sale, making the transaction
uneconomic for the retailer.

Some businesses do not accept card payments at all, even in an era with declining use of
cash. This still happens for a variety of reasons, tax avoidance by small business included.

In 2019, £35,000 million in tax revenue was lost in the United Kingdom due to cash-only
payments. Many businesses such as, barber shops, fish & chip shops, Chinese takeaways,
the black market, and even some building sites are known for cash-in-hand payments in the
UK, meaning high amounts of money can be unaccounted for.

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1. Australia:

Debit cards in Australia are called different names depending on the issuing
bank: Commonwealth Bank of Australia: Key card; Westpac Banking Corporation Handy
card; National Australia Bank Flexi Card; ANZ Bank: Access card; Bendigo Bank: Easy
Money card.

A payment in Australia using a debit card is commonly called EFTPOS, which is very
popular and has been operating there since the 1980s. EFTPOS-enabled cards are accepted
at almost all swipe terminals able to accept credit cards, regardless of the bank that issued
the card, including Maestro cards issued by foreign banks and formerly issued by the
Commonwealth Bank, with most businesses accepting them, with 450,000 point of sale
terminals.

EFTPOS cards can also be used to deposit and withdraw cash over the counter at Australia
Post outlets participating in Giro Post and withdrawals without purchase from certain major
retailers, just as if the transaction was conducted at a bank branch, even if the bank branch
is closed. Electronic transactions in Australia are generally processed via the Telstra
Argent and Optus Transact Plus network—which has recently superseded the
old Transcend network in the last few years. Most early key cards were only usable for
EFTPOS and at ATM or bank branches, whilst the new debit card system works in the same
way as a credit card, except it will only use funds in the specified bank account. This means
that, among other advantages, the new system is suitable for electronic purchases without a
delay of two to four days for bank-to-bank money transfers.

Australia operates both electronic credit card transaction authorization and traditional
EFTPOS debit card authorization systems, the difference between the two being that
EFTPOS transactions are authorized by a personal identification number (PIN) while credit
card transactions can additionally be authorized using a contactless payment mechanism
(requiring a PIN for purchases over $200). If the user fails to enter the correct pin three times,

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the consequences range from the card being locked out for a minimum 24-hour period, a
phone call or trip to the branch to reactivate with a new PIN, the card being cut up by the
merchant, or in the case of an ATM, being kept inside the machine, both of which require a
new card to be ordered.

Generally credit card transaction costs are borne by the merchant with no fee applied to the
end user (although a direct consumer surcharge of 0.5–3% is not uncommon) while EFTPOS
transactions cost the consumer an applicable withdrawal fee charged by their bank.

The introduction of Visa and MasterCard debit cards along with regulation in the settlement
fees charged by the operators of both EFTPOS and credit cards by the Reserve Bank has
seen a continuation in the increasing ubiquity of credit card use among Australians and a
general decline in the profile of EFTPOS. However, the regulation of settlement fees also
removed the ability of banks, who typically provide merchant services to retailers on behalf
of Visa or MasterCard, from stopping those retailers charging extra fees to take payment by
credit card instead of cash or EFTPOS.

2. Canada:

Canada has a nationwide EFTPOS system, called Interac Direct Payment (IDP). Since being
introduced in 1994, IDP has become the most popular payment method in the country.
Previously, debit cards have been in use for ABM usage since the late 1970s, with credit
unions in Saskatchewan and Alberta introducing the first card-based, networked ATMs
beginning in June 1977. Debit cards, which could be used anywhere a credit card was
accepted, were first introduced in Canada by Saskatchewan Credit Unions in 1982. In the
early 1990s, pilot projects were conducted among Canada's six largest banks to gauge
security, accuracy and feasibility of the Interac system. Slowly in the later half of the 1990s,
it was estimated that approximately 50% of retailers offered Interac as a source of payment.
Retailers, many small transaction retailers like coffee shops, resisted offering IDP to promote
faster service. In 2009, 99% of retailers offer IDP as an alternative payment form.

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In Canada, the debit card is sometimes referred to as a "bank card". It is a client card issued
by a bank that provides access to funds and other bank account transactions, such as
transferring funds, checking balances, paying bills, etc., as well as point of purchase
transactions connected on the Interac network. Since its national launch in 1994, Interac
Direct Payment has become so widespread that, as of 2001, more transactions in Canada
were completed using debit cards than cash. This popularity may be partially attributable to
two main factors: the convenience of not having to carry cash, and the availability of
automated bank machines (ABMs) and direct payment merchants on the network. Debit
cards may be considered similar to stored-value cards in that they represent a finite amount
of money owed by the card issuer to the holder. They are different in that stored-value cards
are generally anonymous and are only usable at the issuer, while debit cards are generally
associated with an individual's bank account and can be used anywhere on
the Interac network.

In Canada, the bank cards can be used at POS and ATMs. Interac Online has also been
introduced in recent years allowing clients of most major Canadian banks to use their debit
cards for online payment with certain merchants as well. Certain financial institutions also
allow their clients to use their debit cards in the United States on the NYCE network. Several
Canadian financial institutions that primarily offer VISA credit cards,
including CIBC, RBC, Scotiabank, and TD, also issue a Visa Debit card in addition to their
Interac debit card, either through dual-network co-branded cards (CIBC, Scotia, and TD), or
as a "virtual" card used alongside the customer's existing Interac debit card (RBC). This
allows for customer to use Interlink for online, over-the-phone, and international
transactions and Plus for international ATMs, since Interac isn't well supported in these
situations.

3. France:

Carte Bancaire (CB), the national payment scheme, in 2008, had 57.5 million cards carrying
its logo and 7.76 billion transactions (POS and ATM) were processed through the e-rsb

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network (135 transactions per card mostly debit or deferred debit). In 2019, Carte Bancaire
had 71.1 million cards carrying its logo and 13.76 billion transactions (POS and ATM) were
processed through its network. Most CB cards are debit cards, either debit or deferred debit.
Less than 10% of CB cards were credit cards.

Banks in France usually charge annual fees for debit cards (despite card payments being very
cost efficient for the banks), yet they do not charge personal customers for chequebooks or
processing checks (despite cheques being very costly for the banks). This imbalance dates
from the unilateral introduction in France of Chip and PIN debit cards in the early 1990s,
when the cost of this technology was much higher than it is now. Credit cards of the type
found in the United Kingdom and United States are unusual in France and the closest
equivalent is the deferred debit card, which operates like a normal debit card, except that all
purchase transactions are postponed until the end of the month, thereby giving the customer
between 1 and 31 days of "interest-free" credit. Banks can charge more for a deferred debit
card.

Most France debit cards are branded with the CB logo, which assures acceptance throughout
France. Most banks now issue Visa or MasterCard co-branded cards, so that the card is
accepted on both the CB and the Visa or Master card networks.

In France payment cards are commonly called Carte Blue ("blue card") regardless of their
actual brand. Carte Blue was a card brand acquired in 2010 by Visa which is not used
anymore. Until its purchase the main characteristic of Carte Blue was to benefit from its
alliance with Visa which allowed the use of the cards on both networks.

Many smaller merchants in France refuse to accept debit cards for transactions under a
certain amount because of the minimum fee charged by merchants' banks per transaction.
But more and more merchants accept debit cards for small amounts, due to the increased use
of debit cards. Merchants in France do not differentiate between debit and credit cards, and

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so both have equal acceptance. It is legal in France to set a minimum amount to transactions,
but the merchants must display it clearly.

In January 2016, 57.2% of all the debit cards in France also had a contactless
payment chip. The maximum amount per transaction was originally set to €20 and the
maximum amount of all contactless payments per day is between €50-100 depending on the
bank. The per-transaction limit increased to €30 in October 2017. Due to the COVID-19
pandemic, the per-transaction limit increased to €50 in May 2020 to comply with demands
from the French government and the European Banking Authority.

4. Germany:

Germany has a dedicated debit card payment system called giro card which is usually co-
branded with V Pay or Maestro depending on the issuing bank. In recent years both Visa
Debit and Master card Debit cards are increasingly more common as well.

Historically, facilities already existed before EFTPOS became popular with the Euro
cheque card, an authorization system initially developed for paper checks where, in addition
to signing the actual check, customers also needed to show the card alongside the check as
a security measure. Those cards could also be used at ATMs and for card-based electronic
funds transfer with PIN entry. These are now the only functions of such cards: the Euro
cheque system (along with the brand) was abandoned in 2002 during the transition from
the Deutsche Mark to the euro. As of 2005, most stores and petrol outlets have EFTPOS
facilities. Processing fees are paid by the businesses, which leads to some business owners
refusing debit card payments for sales totalling less than a certain amount, usually 5 or 10
euro.

To avoid the processing fees, many businesses resorted to using direct debit, which is then
called electronic direct debit. The point-of-sale terminal reads the bank sort code and account
number from the card but instead of handling the transaction through the Giro card network
it simply prints a form, which the customer signs to authorise the debit note. However, this

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method also avoids any verification or payment guarantee provided by the network. Further,
customers can return debit notes by notifying their bank without giving a reason. This means
that the beneficiary bears the risk of fraud and illiquidity. Some business mitigate the risk by
consulting a proprietary blacklist or by switching to Giro card for higher transaction
amounts.

Around 2000, an Electronic Purse Card was introduced, dubbed Geldkarte ("money card").
It makes use of the smart card chip on the front of the standard issue debit card. This chip
can be charged with up to 200 euro, and is advertised as a means of making medium to very
small payments, even down to several euros or cent payments. The key factor here is that no
processing fees are deducted by banks. It did not gain the popularity its inventors had hoped
for. As of 2020, several partners pulled out of accepting the Geldkarte which is no longer
issued and set to be retired altogether in the near future.

5. India:

After the demonetization by current government in the December 2016, there has been a
surge in cashless transactions, so nowadays you could find card acceptance in most places.
The debit card was mostly used for ATM transactions. RBI has announced that fees are not
justified so transactions have no processing fees. Almost half of Indian debit and credit card
users use Ru pay card. Some Indian banks issue Visa debit cards, though some banks
(like SBI and Citibank India) also issue Maestro cards. The debit card transactions are
routed through Ru pay (mostly), Visa or MasterCard networks in India and overseas rather
than directly via the issuing bank.

The National Payments Corporation of India (NPCI) has launched a new card
called RuPay. It is similar to Singapore's NETS and Mainland China's UnionPay.

As the COVID cases in India are surging up, the banking institution has shifted its focus
to contactless payment options such as contactless debit card, contactless credit card and
contactless prepaid card. The payment methods are changing drastically in India because

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of social distancing norms and lockdown; people are using more of the digital transactions
rather than cash.

6. United States:

In the U.S., EFTPOS is universally referred to simply as debit. The largest pre-paid debit
card company is Green Dot Corporation, by market capitalization. The same interbank
networks that operate the ATM network also operate the POS network. Most interbank
networks, such as Pulse, NYCE, MAC, Tyme, SHAZAM, STAR, and so on, are regional
and do not overlap, however, most ATM/POS networks have agreements to accept each
other's cards. This means that cards issued by one network will typically work anywhere
they accept ATM/POS cards for payment. For example, a NYCE card will work at a Pulse
POS terminal or ATM, and vice versa. Debit cards in the United States are usually issued
with a Visa, MasterCard, Discover or American Express logo allowing use of their
signature-based networks. In 2018, there were 5.836 billion debit cards in circulation in the
U.S., and 71.7% were prepaid cards.

U.S. Federal law caps the liability of a U.S. debit card user in case of loss or theft at US$50
if the loss or theft is reported to the issuing bank in two business days after the customer
notices the loss. Most banks will, however, set this limit to $0 for debit cards issued to their
customers which are linked to their checking or savings account. Unlike credit cards, loss or
theft reported more than two business days after being discovered is capped at $500 (vs. $50
for credit cards), and if reported more than 60 calendar days after the statement is sent all
the money in the account may be lost

The fees charged to merchants for offline debit purchases vs. the lack of fees charged to
merchants for processing online debit purchases and paper checks have prompted some
major merchants in the U.S. to file lawsuits against debit-card transaction processors, such
as Visa and MasterCard. In 2003, Visa and MasterCard agreed to settle the largest of these
lawsuits for $2 billion and $1 billion, respectively.

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Some consumers prefer "credit" transactions because of the lack of a fee charged to the
consumer/purchaser. A few debit cards in the U.S. offer rewards for using "credit". However,
since "credit" transactions cost more for merchants, many terminals at PIN-accepting
merchant locations now make the "credit" function more difficult to access

As a result of the Dodd–Frank Wall Street Reform and Consumer Protection Act, U.S.
merchants can now set a minimum purchase amount for credit card transactions, as long as
it does not exceed $10.

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BIBLOGRAPHY AND REFERENCES

WEB SOURCES

 www.wikipedia.com

 www.economictimes.com

 www.financialexpress.com

 www.bankbazar.com

 www.investopedia.com

 www.outlookindia.com

 www.intelligenteconomist.com

 www.businessstandard.com

 www.corporatefinanceinstitute.com

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