In spite of the growing number of consumers using debit cards, many still don't know much about them. With a debit card, also known as a cheque card, the amount you spend is limited by what you have in your bank account. Debit cards look like credit cards or ATM (automated teller machine) cards, but operate like cash or a personal cheque. When you use a debit card, your money is quickly deducted from your cheque or savings account.

A debit card is the answer if you don?t trust yourself with a credit card. It also eliminates the need for you to carry large amounts of cash around. You use it like you would use a credit card: you simply swipe your card and enter your pin number in the merchant's terminal. It's like having an ATM in every store.

There are two types of debit transactions. The first is online transactions you perform at an ATM. Just put in a personal identification code (PIN) and funds are electronically transferred from your account as you designate. The second is offline transactions: present your card in a store and it is treated like a credit card sale. The money used to pay for the transaction is then deducted from your checking account, usually within a day or two.

Many consumers don't understand their liability limits, and are confused about protections offered by banks and debit card providers. When you apply for a debit card, you should ask the following questions.