Fund Transfer or Debit Card: Choosing What's Right for You

Slowly but steadily, there’s no doubt that Cambodia is moving towards a cashless society. Did you know that in 2017 alone, the Asia region transacted a whopping amount of 124 billion US dollars (all online)? If you’ve made a contactless transaction before, you’ve probably contributed to the billion-amount record. Crazy right?


It’s no surprise that we’re all familiar with fund transfer or paying with a debit card. However, have you ever wondered which payment method benefits you the most? That’s exactly what we’re going to cover today in this article. Hopefully, by the end of it, you’ll find one that suits your lifestyle best.

Is Fund Transfer a Better Option?

The funds transfer is a payment method that is still widely used in Cambodia compared to debit cards. The 9 digital number displayed in stores is no stranger to anyone. Even online shops showcase their account number for funds transfer purposes. While this payment method may seem like an easy and convenient way to make a payment, it may not be the most foolproof way to make a payment. We all know that you need to type in the receiver’s account number in order to make a fund transfer. But what happens if you mistakenly enter a single-digit incorrectly? If you’re not careful, the transaction would immediately go into someone else’s account. Often, when this happens, you will be required to contact the bank to reverse the transaction. Keep in mind that not only the reverse transaction process does not happen immediately, you’ll also waste your money on the interbank transfer charges. This results in making the entire shopping experience a less desireble one. Besides, shopping is supposed to be fun and exciting, right?


On top of that, fund transfers take a longer time to make payment, as you have to complete the entire process of entering in the recipient’s account number, the amount to be paid and so on, compared to the instant payment of a debit card. You can save time and avoid a few awkward moments between you and the cashier with just a tap of your debit card!

Is a Debit Card Safe?

There’s a misconception that many of us share when it comes to the security of using a debit card. According to Global Data, this happens because of the lack of public awareness about debit cards in general. In fact, many Cambodians might not feel the need to own and pay with a debit card due to its unavailability in most shops.


If you don’t know much about debit cards, don’t worry! Here are a few things you should know:


A more secure payment system.

Remember, it’s important to debunk financial myths so that you can benefit from financial tools that are made available for you. For starters, you can be rest assured that the debit card payment method is very secure. All debit cards have a built-in functionality known as the two-factor authentication. It is a security process in which users provide two different authentication factors to verify themselves. This process is done to better protect both the user’s credentials and the resources the user can access. For instance, when you make a transaction online, you’ll receive an SMS notification with a security pin number called “One Time Password” (OTP pin). To complete the transaction online, you must enter the pin. This pin acts as ‘consent’ that the merchant is allowed to receive payment from your bank account. In cases of which you’ve received this security PIN when you’re not performing a transaction, you’re able to make a report to your bank in case someone else is trying to make a payment with your card.


Debit Card Benefits

Depending on the agreement between you and the card issuer, you may enjoy various financial perks and gifts such as free meals on your birthday, card-exclusive shopping discounts, and more as compared to using fund transfer. The debit card is a great payment option when it comes cross-border purchases as not only is it convenient, but secure and accepted globally. Additionally, a debit card comes in handy when you’re travelling abroad since many countries around the world are moving towards cashless societies. With the convenience of the debit card, you won’t have to carry a large sum of cash with you when you’re abroad – especially when you’re out and about. On top of that, if your debit card ever gets stolen, you’re only a phone call away to deactivate your card so that no one else can withdraw money or pay with the card. Depending on your bank, you might even be able to freeze the card on the mobile app directly, and unfreeze it if you manage to find it. Convenient, right?


Below is a bite-sized recap on the pros and cons of both payment methods:

 Fund TransferDebit Card
Pros• Widely offered in brick-and-mortar stores in Cambodia, making it a convenient payment option• Easy to pay securely with just a tap or with Pin security; no need to enter an account number

• Promotions, discounts or other perks may be offered depending on the card issuer

• Widely accepted mode of payment for cross-border online purchases (e.g. Amazon, Facebook marketing, airline tickets, Taobao, Alibaba, etc.)
Cons• Prone to human error, such as when you mistakenly transfer to the wrong bank account and hence have to get the transaction reversed

• Interbank transfers might incur extra processing fees, resulting in your purchase costing more

• Established e-commerce platforms such as Amazon do not accept this payment method
• Not all brick-and-mortar stores may accept this card payments

• Online stores and social media businesses (Facebook and Instagram) usually do not accept debit card payments either

Now, the question is, should you forgo one payment method for another completely?


Of course not, at least not for now. The best indicator to help you decide which payment method works best might depend on the situation you’re in. We’ve created a few scenarios to give you a better idea of how different payment methods work differently to the user’s benefit:


Scenario A: Shopping online

Whether you’re shopping on an international online platform or a local one such as L192 by LITTLEFASHION, we would advise you to opt for the debit card as a payment method. You’ll find that debit cards are a widely accepted payment method in online shops globally. Most importantly, however, you are able to make a secure transaction with peace of mind. You can even opt for a virtual debit card if your bank offers it, which allows you the same function as a physical one, but with that extra sense of security since a new card number is generated for each use. It is useful that you can track your transactions via your bank mobile app or online banking as well, so that you know where your money went.


Scenario B: Paying back a friend.

Paying back is easy, especially if you’re using fund transfer. To make your life even easier, you can save your friends’ account numbers under ‘Favourites’ in your mobile app so you don’t have to keep retyping their account numbers whenever you need to make a transaction. However, keep in mind you might need to pay a fee to transfer between different banks!


Scenario C: In-store transactions.

Always use your debit card if there’s a card payment terminal available in store. This way, you can pay with just a tap, or a quick entry of your PIN number. Depending on your bank, you might even occasionally benefit from rewards, promotions or discounts. If card payments aren’t accepted in the particular store, however, the next alternatives would be to pay via fund transfer or cash.

We’ve finally wrapped up the two most common cashless payment methods in Cambodia. Ultimately, there is no wrong way to make a payment. You might like fund transfer or using a debit card, depending on what benefits you the most. After all, they’re your tools to use! As technology advances, we can expect more cashless payment methods, which might be easier and more convenient to use, to become available in the market gradually. But for now, have you decided which one works better for you on the daily?

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