What’s the difference between running my debit card as credit or debit?

Mother and daughter shopping

When you pay with your TwinStar Visa® debit card at a check-out counter, you often have a choice between running your card as debit or credit. What’s the difference?

When you choose debit, you key in your PIN. Sometimes merchants, like some Starbucks, allow small transactions without putting in your PIN. If you don't have enough funds in your account, the transaction will be declined.

When you choose to run your debit card as credit, you sign your name for the transaction instead of entering your PIN. The transaction goes through Visa’s payment network and a hold is placed on the funds in your account. The transaction usually settles from your account within two to three days. The merchant pays a small fee, and TwinStar receives a small amount of interchange income from the transaction. This helps offset costs and allows for the credit union to offer lower rates.

Here’s the difference in a nutshell:

When you run your card as debit

  • You enter your PIN.
  • Money for the transaction comes out of your account immediately.
  • Merchant pays a lower transaction fee.
  • Many merchants will allow you to get cash back from your account at the register.

When you run your card as credit

  • You may sign a receipt.
  • A hold is put on your money for the transaction, which clears in a day or so.
  • Merchant pays a higher transaction fee, a small amount of which goes to your credit union as interchange income.
  • You can’t get cash back from your account.

Running a debit card as “credit” is not the same thing as using a credit card. Your debit card is attached to your checking account. A credit card is a line of credit, meaning that TwinStar is actually lending you the money for the purchase and billing you for it later. As long as you have not exceeded your credit card limit (and your account is in good standing), your transaction on your credit card will not be declined.

Whichever way you run your debit card, banking with a local credit union makes it easier to solve a problem with your account. You deal with local people who care about you as a member rather than with strangers in a call center that may be thousands of miles away.