In 2023, many different payment methods and services will be available to Canadian consumers. Older methods like cash and cheques are still quite viable for many transactions. Still, we now have many more digital methods available, such as money transfer apps, money wiring, credit and debit cards, and Interac e-transfer for compatible banks.
Two of the most used payment methods are Visa Debit and Interac e-transfer. While both options are quite reputable and advantageous, you may wonder: Which payment method is the best option? To learn more about Visa Debit vs Interac and how they compare to each other, keep reading below.
What is Interac?
Interac is a newer payment method in comparison to tried and true methods like Visa and other credit cards. Interac is best known for its money transfer service, which allows Canadian bank account holders to securely send funds from their personal bank account to a recipient.
Once the transaction has been completed, the money goes directly to the recipient within seconds, either to be deposited automatically through auto-deposit or after the recipient has completed the security question and answer portion.
In addition to being used to send money, you can also use e-transfer to pay bills like rent and car payments or split expenses with others.
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In addition to e-transfer services, Interac also offers Interac Debit, which allows customers to make payments and purchases from their bank accounts directly. The Interac Debit service works similarly to Visa in that it can be used to make purchases both online and in-store.
While this card isn’t accepted in as many stores as Visa, it’s an acceptable form of payment in a number of Canadian stores compatible with Interac’s services.
What is Visa Debit?
Visa is one of the most well-known financial companies, as it’s available to use in most parts of the world. Visa Debit works exactly like a debit card. You can also use it in places that accept Visa – which is quite a few places! In most cases, this means that you can use your debit card regardless of which store you’re visiting and can even use it in other countries.
Like Interac, these purchases are processed immediately so any funds will be automatically deducted from your account after you make a purchase. These cards are also available as temporary cards with a set balance, which can be purchased in stores like a gift card. Customers can use these temporary cards the same way they would use a regular Visa Debit card and they will be accepted at any store that accepts regular Visa cards.
Interac vs Visa Debit: How they compare
Both types of cards are excellent services that have their own unique features and benefits. Because each of these payment methods is reliable, consumers often have a difficult time deciding when to use each method.
Below, we’ll look at a few categories associated with these two payment methods to see how they rank in each section.
Making payments
One of the first things that may come to mind for consumers when discussing comparing Visa Debit vs Interac is how they are best used for making payments and purchases.
If you’re planning on sending money to friends or family, or you’re making a purchase from an independent merchant, you may find Interac e-transfer to be the best option. Many independent brands that are featured at pop-ups like farmer’s markets and festivals don’t have debit machines available, and will often request payments be made in cash or via e-transfer.
Also, sending money to your friends or family members’ accounts is quite easy with Interac, as the service is already linked to your bank account. While Visa does have a money transfer service called Visa Direct, Interac e-transfer is much faster. While Interac deposits money into the recipient’s account instantaneously, Visa Direct can take from 24-48 hours to complete a transaction.
On the other hand, when it comes to making purchases in stores and shopping online, you may find that Visa Debit is the more widely accepted form of payment compared to Interac. With Visa Debit, you can purchase items online from other countries and shop at the majority of stores both in your area and across the country.
Transaction limits
Transaction limits on your Visa Debit or Interac accounts will be determined by your bank. These limits can vary drastically depending on the specific financial institution, the age of your bank account, and your current credit standing.
However, in general, consumers can expect default transaction limits on their Visa Debit and Interac transfers to be around $1,000 each day and per transaction. Interac cards sometimes have stricter transaction limits for tapping their card, coming in at around $250 per transaction. If the purchase is larger, they’ll have to type in their PIN manually.
In most cases, consumers can request to have their transaction limits increased by their financial institution, which will allow them to make larger purchases both with Visa and Interac. Regarding transaction limits, Visa will generally give more leeway in daily limits but these two services rely mainly on the individual to have their limits increased.
Associated fees
When it comes to fees charged by making Interac transactions, how much you pay or whether you’ll be charged at all comes down to the financial institution that you use.
Some banks will charge customers who made an Interac e-transfer transaction by taking money out of their Savings or Business Savings accounts, ranging from $1.00 to $5.00 approx. Depending on which account the funds were drawn from. Some banks may also charge customers when they make Interac Debit purchases, which will be included in a monthly fee.
Similar to Interac, Visa does not charge customers directly for making purchases with their card. However, some financial institutions may charge small transaction fees, which can be hefty if you’re making international purchases.
International use
If you’re debating between Interac Debit vs Visa Debit for an international purchase, choose your Visa Debit. As touched on above, Visa is accepted by most merchants around the world, while Interac cards can only be used for domestic payments.
Furthermore, you cannot use Interact to send money internationally, as this service is strictly intended to be used to send money through Canadian banking institutions.
However, consumers who wish to send funds to another person outside of Canada can use other services like Knightsbridge Foreign Exchange, which both transfers the funds and converts them to foreign currency at a very low interest rate (you can learn more about our service on the Get Started page).
Conclusion – Visa Debit vs Interac
Both Visa and Interac are reputable financial companies and legitimate options for purchasing items and making payments, and each has its own strengths in different categories.
If you’re planning on travelling internationally, Visa Debit is the best payment method choice, as Interac is only accepted within Canada. On the flip side, Interac is a better option for money transfers in comparison to Visa Direct, as the process is much quicker.
