Debit Cards Versus Credit Cards When Renting A Car

1. Rental car policies vary. Some rental car companies are better about accepting a debit card than others are. It’s a good idea to conduct an online search for the most friendly companies. Rent A Wreck, for example, states on its website that most of its locations accept debit cards with the Visa or MasterCard logo. The bigger rental companies, such as Avis, might not accept debit cards in some locations. And if they do, there are usually certain restrictions.
2. You might need to prove you are traveling. Many car rental companies won’t rent to a local person with a debit card. They are typically afraid you might skip town with their car.
3. You might be subject to a credit check. If you have bad credit, you might not want to try to rent a car with a debit card, particularly at a major rental car company. Every time your credit is pulled, it shows up on your credit report, and too many inquiries can lower your score.
4. A rental car company might put a block or a hold on your debit card account for the rental cost plus some extra, typically $100 to $500. You won’t have access to your money during the holding period, which generally ends when you return and pay for the car. However, the holding period could last for up to 15 days after you pay, according to the Federal Trade Commission.
5. Debit cards don’t cover rental car insurance. When pondering debit card vs. credit card protection, credit cards win. Most major credit cards offer some type of car rental insurance. They typically cover damages that aren’t covered by your primary auto insurance policy. But a debit card offers no insurance. It’s a good idea to call your primary auto insurance provider for advice on whether to buy extra insurance from the car rental company.

There’s no question that renting a car is easier with a credit card, so if you have a choice between debit cards versus credit cards, choose a credit card. If you don’t want to deal with the hassles of trying to rent a car with a debit card, consider taking out a secured credit card, which works just like any other credit card, even at rental car companies. The only difference is that you must deposit money to the secured card, and that becomes your credit limit.