This distinction can be very important:
- Users of credit cards have much lower limits of liability than users of debit cards when a card is stolen or misused. Some issuers of deferred debit cards are reportedly offering the same level of protection as for credit cards, but this is a voluntary extension that could be withdrawn.
- Users of credit cards have other rights under consumer protection laws that users of debit cards don't enjoy.
- Using a debit card for a purchase that has an uncertain initial amount, such as a hotel stay, can result in freezing one's cash for a period of time.
- Some if not most deferred debit cards can be used in either PIN mode or signature mode. You may find that a merchant, particularly overseas, does not accept one mode or the other -- leading to confusion or delay at check-out.
- Deferred debit cards might not carry some of the benefits, such as insurance of rental cars, that your credit card did.