Why Use Debit Cards With Savings Accounts

Consider getting a debit card linked to your savings account and take advantage of the convenience and practical benefits

Featured Debit Card Offer

The NAB Classic Banking everyday account is a great option if you are looking for an everyday transaction account that will help you avoid ever having to pay bank fees.

NAB Classic Banking Features:

• No minimum opening balance required
• No monthly account service fees for life!
• Unlimited access via NAB ATMs, branch, phone banking, internet and rediATMs.
• Linked to NAB Debit Card or Credit Card
• Overseas ATM access
• Enhanced account security
• Cannex 5 star rated transaction account

Find out more about this offer

Chances are that if you maintain a cheque or transaction account with a bank, you also have a debit card with them. Debit cards are very convenient and incredibly useful in day-to-day transactions. Unlike credit cards there are no requirements of credit records and verification, which makes it much easier for the bank to track such an account. Also, the use of debit cards creates income for the bank in the form of merchant fees. Every time you use your Visa or MasterCard at a merchant outlet, the payment processing company takes a small percentage of the transaction as a fee, which they split with the card issuing bank or financial institution according to their contract. Sometimes the merchant will add the cost of this fee and pass it on to the customer.

Whatever course of action the merchant takes, this still ends up providing a revenue stream for the banks. Since the cost of maintaining a debit card will most likely be far exceeded by the income from merchant fees, banks are usually quick to provide debit cards to their customers free of charge.

Most consumers who have savings accounts will also get offered a debit card. Unlike transaction accounts which pay very little to no interest, savings accounts are more popular with customers as they provide a modest interest on the deposited balance. You do have to pay annual fees, and there are often restrictions on the amount that can be withdrawn or the number of transactions made in a month. This is because a higher transaction volume incurs greater overhead expenses for the bank, which they pass on the customers holding savings accounts.

While you could use a debit card with a savings account, it makes much more sense to have them in conjunction with offset accounts, particularly if you also happen to have a mortgage outstanding. Offset accounts are a special type of savings account, where the balance you keep in the account can be used to offset against your mortgage balance. This means that you pay less interest on your mortgage as your balance is reduced, while enjoying the interest earned from your savings, and the freedom to withdraw money from it as well.

While typical mortgage accounts do let you withdraw money from them through redraw facilities, they have numerous restrictions in place, and can even place penalties and fines on withdrawals. Offset accounts do not suffer from the same restrictions, which is why you should use your debit card in conjunction with a savings account that allows offsetting benefits.

Check out today's featured offers:

Westpac Low Rate	Citibank Clear Platinum	Qantas AMEX Discovery	ANZ Platinum
0% p.a. for 6 months on purchases & balance transfers	2.9% p.a. for 12 months on balance transfers	$0 annual fee Up to 10,000 Bonus QFF Points	0% p.a. for 6 months on purchases & balance transfers

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Popular Credit Card Offers

			Interest Rate (p.a.)	Balance Transfer Rate (p.a.)	Annual fee	Cash Advance Rate (p.a.)
	Westpac Low Rate Card - 0% Offer	A credit card with a low rate offer on both balance transfers and purchases, plus a low annual fee.	0% for 6 months (reverts to 13.49% )	0% for 6 months	$45	21.49%
	Citibank Clear Platinum Card	Competitive interest rate on purchases and balance transfers offer.	11.99%	2.9% for 12 months	$99	21.74%
	St George Vertigo	Take advantage of this great offer from St.George with a low rate on purchases and a low balance transfer offer.	13.24%	0.99% for 12 months	$55	21.49%
	ANZ Platinum Credit Card	An introductory interest rate offer on balance transfers and purchases, plus a $0 first year annual fee.	0% for 6 months (reverts to 19.24% )	0% for 6 months	$0 annual fee for the first year( $87 thereafter)	20.99%