Using Debit Cards in India – Tips on Usage

We live in a plastic world; I am not referring to the kind of lives or smiles we see but how plastic money has replaced wads of currency notes and clink of coins.

Debit cards or for that all kinds of cards whether it is credit cards, smart cards, prepaid cards or ATM cards have made life simpler especially when you want to travel.

But like any technology you need to be careful about its usage and clear about its features. We are specifically going to talk about using Debit cards in India in this article.

Example I

I remember an incident from my banking days when a distraught woman had come complaining that she had lost Rs. 40000 from her account through debit card and she claimed that she had not used it.

Well after the initial probing and cursing by the customer (obviously) the bank decided to retrieve the CCTV footage from the ATM. The footage revealed that it was her colleague at the office who had made the transactions across a period of three months. The lady had left her card in the drawer at her workstation which was often unmanned and the pin was conveniently written on the cover of the card (she thought it was discreet and illegible).

Well obviously doing any of the following three could have saved her from the trouble

a) Not leaving the card carelessly;

b) Pin number should never be written on the card or anywhere near it and

c) Checking transaction regularly would have made her aware of these withdrawals. It is not always’ the bank’s fault sometimes we invite trouble.

d) Another thing that could have saved the day in this case is mobile alerts; the lady would have come to know that there has been an authorized transaction.

Example II

NRO accounts are a Non Resident Ordinary accounts in which the funds are not fully repatriable (meaning they cannot be taken back to the country of origin; this is a guideline by RBI). Thus to ensure this the cards issued in NRO accounts are valid for use within the country.

Multiple Uses of Debit Cards

Using debit cards in India, you can do these types of transactions

1. Financial

There are a host of financial transactions possible by using your card.

a) Cash withdrawal from not only the same bank ATMs but other bank ATMs too. You can check with your bank to get a list of banks from which you can make withdrawal without being charged.

b) The card can be swiped just like a credit card at POS (point of sales)

c) In case your card has the CVV number you can use it online for making transactions.

d) Bill payment for select few partners

e) Cash deposit (all machines may not have this facility)

f) Fund transfer

2. Non Financial

Your debit card can actually serve as an alternate banking channel and you can do the following from your card:

a) Check your balance

b) Take a mini statement (last five transactions)

c) Order a cheque book

d) Deposit cheques

e) Change your PIN

f) Buy other investment products (fixed deposit/insurance/mutual funds)

Conclusion – Using Debit Cards in India

Debit cards present a win-win situation for both the bank and the customer. For the bank it is beneficial as it reduces the customer concentration in the branches and offers a less expensive banking channel.

For the customers it offers them convenience of banking anywhere and anytime (as illustrated above you can do a lot with your debit card) without the hassle of waiting in queues.

Debit cards have revolutionized both the shopping experience and the banking world. Using debit cards in India safely and effectively is important.

Read about debit card security in our follow-up article