When you open a savings account with any bank, you will be provided with an ATM card or a basic debit card for free. This is usually a magnetic strip card that comes with nil or low annual fees. You might think that this is the best debit card as you don’t have to shell out much from your pocket. However, these cards do not have the benefits that a premium debit card can give you for a fee. The fees for premium debit cards are usually low and start at Rs 199 per year. The benefits of premium debit cards are listed below.
Free ATM Withdrawals
As you might know, there are ATM withdrawal restrictions. Most banks provide five free transactions per month when you withdraw from the same bank’s ATM and three free transactions when you use other bank’s ATM. These for metros. For non-metros, it is five transactions in same bank ATM and five in other bank ATMs. This applies to those who have a basic debit card. If you exceed this limit, you will be charged Rs 20 plus GST. However, those who have premium debit cards are offered free ATM withdrawals at any bank. There is no restriction as to the number of transactions. For example, the Axis Burgundy World Debit Card offers free ATM withdrawals from any bank ATM in India and abroad.
Higher ATM Withdrawal Limits
Every basic debit card will have an ATM withdrawal limit. This will be about Rs 25,000 to Rs 40,000 per day. However, with a premium debit card, you get ATM withdrawals of more than Rs 2 lakh a day. For example, with the HSBC Premier Platinum Debit Card, you can withdraw up to Rs 2.5 lakh per day.
Higher Shopping Limit
When you use your debit card at merchant outlets, there will be a transaction limit. So, you can swipe only that much a day when you go shopping. This limit is usually about Rs 1 lakh for basic debit cards. However, if you have a premium debit card, you can use up to Rs 6 lakh. For example, with the Axis Bank Online Rewards Debit Card, you get a purchase limit of Rs 4 lakh.
Get Lost Card Cover
Basic debit cards may or may not come with lost card liability cover. This is the insurance provided when you lose your card. However, premium debit cards can provide you with a cover of up to Rs 6 lakh if you lose your card. For example, the Indusind Bank Platinum Visa Debit Card provides you with lost liability cover of Rs 3 lakh.
Get Personal Accident Cover
Basic debit cards may not provide you with a personal accident insurance cover. Even if they give a cover, it will be for only about Rs 1 lakh. Premium debit cards provide accident cover of up to Rs 20 lakh. Take Axis Burgundy World Debit Card for example. This card comes with Rs 15 lakh of personal accident cover.
Basic debit cards do not offer freebies or goodies. Premium debit cards give you discount vouchers, movie tickets, dining discounts and other benefits. Some debit cards even give you free airport lounge access like premium credit cards. For example, ICICI bank’s Coral Debit Card gives you complimentary airport lounge access.
Some premium debit cards even provide you with fuel surcharge waiver of 2.5%. If you use ICICI bank’s Coral Debit Card, you don’t have to pay fuel surcharge at selected HPCL pumps. There are other benefits such as welcome reward points, joining bonuses and discounts for online shopping. With the Indusind Signature Debit Card, you get buy-one-get-one-free on bookmyshow.com.
So, a premium debit card that comes with an annual fee can actually provide you with much more savings than a basic debit card. In fact, if you use a premium debit card instead of a premium credit card, you can even ensure that you stay within the budget. However, you have to check whether the annual fee is worth the money by looking at the benefits offered. You might not be asked for any documents if you already hold an account with the bank.