Visa recently reported that Americans are spending more money on debit cards than on credit cards. In 2008, Visa announced that Visa debit card spending accounted for $206 billion, while Visa credit card spending accounted for a lesser $203 billion.
Consumers are trying to avoid greater credit card debt and the immediacy of debit cards allows them to do that. During this time of economic woe, it makes sense that Americans are making the switch to debit over credit. The similarity of debit and credit also accounts for the higher use of debit cards. Both plastic, you simply hand over the debit card as you would a credit card and you’re done, without having to pay back a balance later or incur interest. Because it’s your own money, you have no extra fees and therefore, no debt.
Credit cards, on the other hand, offer greater fraud protection. If a credit card is stolen, the most you are required to pay for an unauthorized transaction by law is $50. Though this protection is not offered with debit cards, the economic situation most Americans are finding themselves in is enough to overlook this small difference.