A free ATM cum Debit Card often comes with minimal benefits. Using a card with an annual fee (if chosen right) can provide a multitude of benefits.
Every bank provides you with a free ATM card, which is a basic Debit Card that has either no annual fees or has a very low annual fee.
You’re probably quite happy with a card like this since nothing goes out of your pocket except the Debit Card issuance fee that the banks might charge. However, you might lose out on a number of benefits that a card with a marginally higher fee can offer.
Here are some of the typical benefits that might get compromised if you opt for a basic Debit Card.
Lower ATM Withdrawal Limits
Typically, a basic Debit Card will have a low ATM withdrawal limit per day. Generally, these are capped at Rs. 40,000 per day for basic cards while for premium cards it could be as high as Rs. 2 lakhs per day.
Additional Reading: Debit Cards With An Extended Credit Limit
No Free ATM Withdrawals
With a basic Debit Card, there are limits to the number of times you can withdraw money from even the ATM of the bank that issued the card. Most of the time, when you cross such a limit, your withdrawals are charged at Rs. 15 plus taxes for every transaction. Premium cards offer free ATM withdrawals at any bank’s ATM.
Every Debit Card has a point of sale (POS) limit. This is the amount of money you can swipe per day at merchant outlets. For basic cards, this is often set at Rs. 1 lakh, while for premium cards it could be as high as Rs. 6 lakhs.
Lost Card Liability Hardly Covered
Most basic cards come with minimal Insurance cover in the event of you losing your card and some fraudulent transactions happening on the card as a result of this. For premium Debit Cards, this Insurance cover could be as much as Rs. 6-8 lakhs, depending on the issuing bank.
Additional Reading: 4 Ways To Protect Your Debit Card From Cyber Crooks
Low Personal Accident Insurance Cover
In a bid to attract customers all banks provide a personal accident Insurance cover with their Debit Card. For basic Debit Cards, this is usually only about Rs. 1 lakh. For premium cards, this cover could be as high as Rs. 15-20 lakhs.
No Free Access To Airport Lounges
Basic Debit Cards do not offer free access to airport lounges in India or abroad whereas premium cards offer this benefit.
Consider this: If you want to access an airport lounge at the Kempegowda International Airport in Bengaluru you need to pay a fee of Rs. 1,800 plus taxes for international departures and Rs. 1,200 plus taxes for domestic departures.
This access is offered for free if you have a premium Debit Card. But note that some cards might restrict such access to 2-3 visits a quarter while for others such restrictions may not apply. So, if you are a frequent flyer, choose your card after checking on this.
Additional Reading: American Express Sets Up Platinum Center At Mumbai Airport
No Fuel Surcharge Waiver
In case you use your basic Debit Card at a petrol bunk for filling fuel for your vehicle, you would be required to pay a 2.5% surcharge on the same. However, if you hold a premium card, this fee is waived off by the bank.
No Additional Benefits
As you might know, premium cardholders are provided with free movie tickets, discount offers for dining and other such benefits. Some banks even provide purchase protection. This is an insurance for goods purchased using your Debit Card. These goods will be insured against theft, fire, and natural calamities by the bank for anywhere between 30 and 90 days from the date of purchase. The value of goods covered could be anywhere between Rs. 3-6 lakhs depending on the type of card chosen.
So, a Debit Card with an annual fee can actually provide you with cash savings that can far outweigh the fees paid by you. So, next time you choose a Debit Card, check out its features and benefits and not just the price.
Alternatively, you could also check out these amazing Credit Card offers to make the most of the rewards and special offers.
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