What distinguishes a credit card from a debit card?

A credit card is characterized by its ability to allow users to borrow money from a financial institution up to a predetermined limit. This means that instead of needing cash upfront for purchases, cardholders can spend up to their credit limit and repay that amount later, often with the option of making minimum payments. This borrowing feature is fundamental to how credit cards operate, as they facilitate spending beyond the user's current cash availability.

In contrast, a debit card links directly to the user's bank account, requiring sufficient funds in the account to complete transactions. Thus, if someone tries to use a debit card without enough money, the transaction will typically be declined. The other options do not accurately depict key differences between credit and debit cards, particularly in terms of the fundamental characteristics that differentiate borrowing from spending your own money directly.