Debit cards make up the vast majority of payment cards used in France. People often incorrectly refer to them using the term 'credit card' but technically, 'credit card' is a payment method used only rarely in France.
A debit card allows users to withdraw cash from ATMs, to pay via card machines in stores or make payments online.
A deferred debit card allows users to make purchases and pay after the purchase. For instance, if the payment is deferred by 25 days, the buyer's account will only be debited 25 days after the payment. It is, therefore, a type of credit. Deferred debit cards are usually used by traders and employees who make numerous, regular purchases.
With a deferred debit card, the user's account is debited, for example, once they have received their salary. The deferment, or delay, does not change for each purchase made. Instead it is established in advance in agreement with the bank. Deferred debit cards are therefore useful if the user faces cash-flow issues but needs a certain regularity of payment in order not to confuse multiple payment dates.
Instant debit cards are another category of debit card. When a user makes a payment, the money is debited from his or her account immediately. Usually, however, it takes 2 or 3 days before the transaction is visible on a bank statement.
Instant debit cards allow users to see their bank balance in (almost) real time and tell users how much available cash they have at a given time.
Users can combine this type of card with payment limits. That way, business-owners and managers can keep control of the spending of their teams and see the state of their accounts in real time. This is the offer proposed by Qonto.
Prior authorization debit cards are another type of debit card. For this type of payment, transactions are only possible if a pre-established limit is not exceeded.
It's therefore possible to be overdrawn with a deferred debit card as long as the pre-established limit permits it. If the user wishes to make a payment that would exceed that limit, the transaction will not be possible.
The deferred debit card allows its users to keep control over spending. It's a very useful way of giving employees freedom over spending without allowing budgets to be exceeded.