View Full Version : Friendly Advice An etymological conundrum
Lheticus
2015-01-13, 12:28 PM
Once again, I find myself in need of tapping in to the remarkably deep pool of knowledgeable people that is the giantitp forums. There's something that's been bugging me in the back of my mind for quite some time and it has now come to the forefront of it: Just what constitutes a "credit" card vs a "debit" card? The reason this is a conundrum is a lecture I attended from I don't even know when or where (though it might have been a school program from years back) in which good financial habits, etc, were discussed, and at one point, the speaker said that most credit cards are in fact technically debit cards, and that the only true "credit" card is American Express! He explained his logic behind this at the time, but I've forgotten it. So essentially, I want help with:
1. Can a case be made for credit cards other than American Express being considered technically to be debit cards, and what is it? Alternatively, what is the argument the mentioned speaker may have used regardless of validity? and
2. If such a case can be made, would it really have any meaning beyond a purely pedantic technicality?
rs2excelsior
2015-01-13, 01:06 PM
As I understand it, with a credit card, you are purchasing things on credit--the promise that you'll pay later. Which is why you can purchase something with a credit card for which you do not have the money, and then pay it back over time (which may or may not be a good idea). Except the credit card company pays whoever you bought stuff from, and you pay back the company.
Debit cards, on the other hand, immediately deduct (debit) money from an account they're tied to. It's basically like writing a check, except quicker and with immediate feedback about whether the "check" will bounce.
So based on that, there are definitely "credit cards" that are really credit cards, other than American Express. That being said, any or all of this could be wrong.
It'd be helpful if you could tell us why he thought American Express was significantly different than other credit cards. Maybe someone who uses American Express could tell us how their cards work differently...?
The_Ditto
2015-01-13, 02:07 PM
Just sounds like a lame excuse to advertise Amex .. :smalltongue:
The argument he used, is probably similar to the "proof" that 1=0 ...
ie "Sounds convincing at first glance, until you look more closely at the absurdity of it, and what rules were broken during."
Bulldog Psion
2015-01-13, 02:18 PM
Credit card = you borrow money through the card from a lending bank, which charges interest until you pay the balance off.
Debit card = you use the card to pay electronically by drawing on an existing pool of funds that already belong to you, as, for example, a bank account.
The difference is quite straightforward. From this, it should be quite easy to determine whether American Express is a credit card or a debit card.
So far as I know, it has to be one or the other; you are either paying with your own money (debit) or somebody else's (credit). If it's a card that allows you to pay with money that belongs neither to you nor to anyone else, I would be interested in seeing how that logic-defying miracle functions.
Siosilvar
2015-01-13, 02:21 PM
There's a third type of card, the charge card. AmEx cards are these and they effectively have no limit but you have to pay in full at the end of every month, which makes them sort of like credit cards in that you don't have to have the money ahead of time.
Bulldog Psion
2015-01-13, 02:31 PM
Sounds like an even worse deal than a credit card to me. :smalleek:
tomandtish
2015-01-13, 02:35 PM
There's a third type of card, the charge card. AmEx cards are these and they effectively have no limit but you have to pay in full at the end of every month, which makes them sort of like credit cards in that you don't have to have the money ahead of time.
Actually, SOME Amex cards are like this. But they also have some that follow the more classic model.
Similarly, you may also see advertising for a debit card that can be used "like a credit card". it's still a debit card, but you sign for purchases instead of a pin (an can be used online).
The types:
Charge card: Buy now. Usually requires signature at purchase (exceptions include online, gas pumps, etc.). Usually has a spending limit (most people will have one). Bill must be paid at end of month.
Credit card: Buy now. Usually requires signature at purchase (see exceptions above). Must pay a percentage of the balance at end of month. Interest accrues on remaining balance. Usually has a spending limit.
Debit card: Buy now. Payment automatically deducted from funds you have placed in account (usually a bank). Payment usually via 4 digit pin, but some can be used like a credit card (although funds must still be available).
Visa, Mastercard, Discover, and Amex are the four most widely used names (at least here in USA). To my knowledge:
Discover tends to be straight credit card
Amex tends to have both charge and credit cards
Visa and Mastercard offer both debit and credit cards
True "debit" cards are extremely rare.
Most are basically credit cards, and are processed the same way, just with the payment occurring shortly afterwards. The surest way to know if you have a "credit" version of a debit card or a true "debit" card is to overdraw your account (don't do this, just ask what would happen).
If yours is a "credit" version, you will overdraw. If yours is true debit, it will decline the transaction.
Lheticus
2015-01-13, 03:16 PM
There's a third type of card, the charge card. AmEx cards are these and they effectively have no limit but you have to pay in full at the end of every month, which makes them sort of like credit cards in that you don't have to have the money ahead of time.
THAT'S IT! THAT was the etymological error. The speaker was interpreting "charge card" as the "actual de facto credit card" idea and saying that for some now irrelevant reason that non charge card credit cards were actually debit cards. Or come to think of it, he could have been saying the other way around like what Crow said about very few cards being "true debit cards."
TheCountAlucard
2015-01-13, 03:30 PM
Yeah, I looked it up. It turns out "entomology" is the study of insects. Go figure. :smalltongue:
Ever since I saw that episode of Phineas & Ferb, I couldn't get that moment out of my head.
Lheticus
2015-01-13, 03:48 PM
Yeah, I looked it up. It turns out "entomology" is the study of insects. Go figure. :smalltongue:
Ever since I saw that episode of Phineas & Ferb, I couldn't get that moment out of my head.
Um, what does this have to do with anything? I said ETYMOLOGY, not entomology sir. :P Which is the study of the origins of words and how their meanings change--the evolution of language, if you will. Only funning btw.
EDIT: Okay I looked up that quote and well...I still don't get why you referenced it because I actually got the word right. ;)
Flickerdart
2015-01-14, 12:05 AM
True "debit" cards are extremely rare.
Most are basically credit cards, and are processed the same way, just with the payment occurring shortly afterwards. The surest way to know if you have a "credit" version of a debit card or a true "debit" card is to overdraw your account (don't do this, just ask what would happen).
If yours is a "credit" version, you will overdraw. If yours is true debit, it will decline the transaction.
From what I understand, it's not exactly uncommon to have an overdraft plan that explicitly adds the functionality. I have one on one of my cards that charges me a flat fee while it's overdrawn, which certainly isn't the behaviour of a credit card.
Bulldog Psion
2015-01-14, 04:06 AM
True "debit" cards are extremely rare.
Most are basically credit cards, and are processed the same way, just with the payment occurring shortly afterwards. The surest way to know if you have a "credit" version of a debit card or a true "debit" card is to overdraw your account (don't do this, just ask what would happen).
If yours is a "credit" version, you will overdraw. If yours is true debit, it will decline the transaction.
I must be a truly rare sort of fellow, then, because I have two debit cards that will decline the transaction outright if there isn't enough money in my account. :smallwink:
Here I was hoping this would be etymology, not semantics.
*walks out dejectedly*
Sounds like an even worse deal than a credit card to me. :smalleek:
I don't think charge cards accrue interest on the amounts though. It means they're slightly less of a trap than credit cards for financially irresponsible people. It's not like you WANT to be holding a balance on a credit card. That's just terrible financially.
I must be a truly rare sort of fellow, then, because I have two debit cards that will decline the transaction outright if there isn't enough money in my account. :smallwink:
With my bank it's optional. By default you can't overdraw the account for your debit card, which is a good idea for kids who stash their pocket money at the bank. A year ago, I asked if I could get a 500€ overdraw limit and got it without any complaints. Though the bank probably has an algorithm in their computers to see how trustworthy I am, based on my past account activity.
I believe a difference with credit cards is that the store does not have to immediately check with your bank if the transaction was processed. As long as it is logged, they can still process it days later, which can be handy.
Though I don't know what would happen if I make a 1000€ purchase with my credit card, even though my bank has set a credit limit of 500€. I believe the store would still get my money, but my bank would be quite angry with me.
Flickerdart
2015-01-14, 10:21 AM
Though I don't know what would happen if I make a 1000€ purchase with my credit card, even though my bank has set a credit limit of 500€. I believe the store would still get my money, but my bank would be quite angry with me.
I've done this before. The transaction is declined.
Lheticus
2015-01-14, 02:10 PM
Here I was hoping this would be etymology, not semantics.
*walks out dejectedly*
Whoops, my bad.
Yeah, I looked it up. It turns out "entomology" is the study of insects. Go figure. :smalltongue:
OK, so here's an entomological conundrum for you:
I was out with my 3-year-old son the other day, when he pointed out a small insect on a leaf and said "Look! A ladybird!"
(That's "ladybug", to most of you American readers. Please insert your own mental translation if it helps.)
While the insect was ladybird-sized and ladybird-shaped, it was not your typical bright-colour-with-black-spots colour scheme. In fact it was a kind of bluish black, and had no spots that I could discern.
Now, we all know that a ladybird is a kind of beetle. And we also know that they come in many colours. But what's the key differentiator? At what point does a ladybird - stop being a ladybird, and become just another of the literally-uncountable species of beetle?
Siosilvar
2015-01-15, 06:53 PM
I don't know about the overdraw thing. Before I set up automatic overdraft protection, my debit card would overdraw once and then decline after that. I know this because I overdrew while on a road trip - luckily I had cell service to move money over. Now it just pulls out of my savings, but I keep better track than I did then, too.
Cyber Punk
2015-01-15, 10:10 PM
Question: Does the minimum amount that must be in your account before your ATM card becomes unable to debit your account further vary by bank? I've never heard of a bank that allows you to keep debiting until you have 0.00 in your acct...
Question: Does the minimum amount that must be in your account before your ATM card becomes unable to debit your account further vary by bank? I've never heard of a bank that allows you to keep debiting until you have 0.00 in your acct...
I don't know where you live or what banks you deal with, but where I come from - those sorts of things fall under the heading of 'business rules', and vary widely not just between banks, but also depending on the type of account, and very likely your individual relationship with the bank.
Two people with the same account at the same bank might have quite different rules. So yeah, the rules between different banks can vary enormously.
Wardog
2015-01-18, 05:36 PM
OK, so here's an entomological conundrum for you:
Now, we all know that a ladybird is a kind of beetle. And we also know that they come in many colours. But what's the key differentiator? At what point does a ladybird - stop being a ladybird, and become just another of the literally-uncountable species of beetle?
According to Wikipedia, ladybirds are family Coccinellidae.
http://en.wikipedia.org/wiki/Coccinellidae
I don't know enough about insect classification to say what the defining characteristics of that family is. This site might help though:
http://www.ladybird-survey.org/what_is.aspx
Eldan
2015-01-19, 02:37 AM
OK, so here's an entomological conundrum for you:
I was out with my 3-year-old son the other day, when he pointed out a small insect on a leaf and said "Look! A ladybird!"
(That's "ladybug", to most of you American readers. Please insert your own mental translation if it helps.)
While the insect was ladybird-sized and ladybird-shaped, it was not your typical bright-colour-with-black-spots colour scheme. In fact it was a kind of bluish black, and had no spots that I could discern.
Now, we all know that a ladybird is a kind of beetle. And we also know that they come in many colours. But what's the key differentiator? At what point does a ladybird - stop being a ladybird, and become just another of the literally-uncountable species of beetle?
Ladybirds are a large group of related species. Some 5000. They come in all colours, with spots, stripes or plain colour. Black or grey colours aren't exactly rare either.
As we have hundreds of thousands of beetles, the differentiation between them becomes quite technical and one has to look at features such as head width, the number of foot segments, the shape of the antennae and the position of the legs.
Generally, though: dome-shaped body, short legs, relatively small, often lighter-coloured spots on the "shoulders" behind the head.
See also:
http://tolweb.org/Coccinellidae
noparlpf
2015-01-19, 10:54 AM
True "debit" cards are extremely rare.
Most are basically credit cards, and are processed the same way, just with the payment occurring shortly afterwards. The surest way to know if you have a "credit" version of a debit card or a true "debit" card is to overdraw your account (don't do this, just ask what would happen).
If yours is a "credit" version, you will overdraw. If yours is true debit, it will decline the transaction.
Yeah, my Visa is a credit "debit". I just get charged way extra if I pay more than I have. It happened once by mistake due to a recurring payment that wasn't even supposed to be recurring, so I did manage to get the overdraft fee refunded.
I can also pay online and sign for things at places that have credit machines but not debit machines.
I don't know enough about insect classification to say what the defining characteristics of that family is. This site might help though:
http://www.ladybird-survey.org/what_is.aspx
That site did help, thank you. And thanks to Eldan too.
Turns out I'd have to minutely examine the feet to be quite sure, but based on the size, body shape, and the positioning of the legs, it seems very likely it was a ladybird.
So there you have it, my 4-year-old son is better at identifying insects than I am.
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