Using a debit Visa or MasterCard gives you the flexibility of using a credit card while spending your own money. Reports have suggested that Woolworths and its various subsidiaries have banned the cards, but the truth is a little more complex.
Lifehacker reader Brett wrote in to point out this development:
Just went to Woolies today. They said that I can't use my Visa Debit card anymore. When I swiped my card, I was only given the option of Cheque or Savings. Very odd as I have used Woolies a few times in the previous week and had no issues. No signs around Woolies, nothing.
However, as a statement on the Woolworths site explains, the company has not barred the use of debit cards — it has switched to processing payments on those cards via the local EFTPOS network, rather than clearing them through the international credit card networks. As a result, the option to select 'credit' as an account doesn't show up on its payment terminals, but the accounts associated with the card will appear.
Since debit cards draw funds from those accounts anyway, it's the same money getting spent. The only real practical difference this makes is that you'll always need a pin number when paying, rather than using a signature.
Update: Check out our longer analysis of this issue.