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To CREDIT or to DEBIT?


These verbs – credit and debit – seem to confuse people. So let’s see if one shall be happy if the bank teller checks their account and says for example:

The full amount of the purchase has been credited to your account.

Surely, as it means that the full amount has been added to the account. As a noun used by accountants credit means an addition to certain accounts.

On the other hand we have a verb debit and the incoming example. Merchant has recently refunded a purchase price of 123 USD to one of his customers but cannot see it in his billing statement, therefore asking the acquiring bank if his refund was successful. The acquiring bank replied:

The merchant has been debited on 12.03.11 with the amount of 123 USD.

So the money have been withdrawn from the merchant’s account and the refund was handled properly.

When a bank account has a positive or debit balance,it means the bank owes money to the customer; and if it has a negative or credit balance – the customer owes money to the bank.

This post was written by Hania Sajnaj-Kaczmarek

Mr. Banks is actually a fictional character, but does some real work. This makes him PayLane's fictional employee of the year :)

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