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Usually when a credit (yes credit and not debit - I didn't mistype) card has too little available credit, some of the card balance needs to be paid off. The available credit is increased by the amount paid up to the maximum approved limit when card was issued.

My question is: Can I also only pay with a DEBIT card exactly the maximum amount which is at that exact time in the checking/saving account to which debit card is linked?

Basically I am asking if is possible to pay on debit card to increase the potential spending amount.

8

When using a debit card there are two limits that may be imposed on the use: the current balance and the maximum daily limit.

If the banking institution limits your daily usage that may mean that on a particular day you may not be able to make a large purchase, even though you have money in the bank.

Otherwise as long as you have funds in the account linked to the debit card you can make the transaction. The catch is that as soon as the transaction is sent to the bank one of two things happens: the money is immediately deducted from the account; or a hold equal to the the amount of the transaction is placed on the account. A hold is generally used when the transaction is done in two parts: the pre-scan at a restaurant, or gas station. The hold reduces the amount of available funds in the account.

A hold or an immediate deduction limits the size of future transactions. To be able to make larger transactions you need to transfer more money into the account. There is no debit card transaction that you can do to artificially allow a larger transaction, unless the bank is not placing a hold or doing an immediate deduction.

Because a debit card is linked to a bank account, some accounts have overdraft protection. This protection comes in two forms: they either transfer your money from another account, or they make a loan. Either way there can be costs involved.

6

You are right in saying that you cannot go over limit on (most) credit cards, however, with a debit card the majority of banks will extend an overdraft to you if your account goes overdrawn (less than 0). The amount of overdraft extended will depend on your credit rating and standing with the bank and may not be extended if they think that the amount is too large or that you are a credit risk. The drawbacks of overdrafts are that they are very expensive usually having a fixed fee for going into overdraft and charging a high rate of interest. If this overdraft has not been prearranged with the bank these costs are usually much higher.

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a typical debit card is subject to several limits:

  1. the account balance. basically, you can't spend more money than is in your account. when you make a purchase, your account balance is instantly lowered by the purchase price. some banks let you overdraw your account by a certain amount, but this typically comes with ridiculous fees and you can (and should) opt out of that service. also, some deposits are not immediately available for use (e.g. you may have to wait for a check to "clear"). banks have different rules about when or how much money is "available", but generally all your money should be available after 3-5 business days. most banks make cash deposits available immediately.
  2. the daily pos limit. this limit applies to purchases at a cash register. it is typically 300$ or 500$, but some banks are as high as 1000$. you can usually call the bank and have this limit temporarily raised to a higher limit if you want to make a large purchase or many smaller purchase in a single day.
  3. the daily atm limit. this limit applies to atm withdrawals, and is separate from your daily pos limit. again, it is typically either 300$ or 500$, but can be higher and can be temporarily raised by asking the bank.

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