The Paypal debit card is Yes a debit card, but when you use it at a POS you have the option of using it as a debit OR a credit card. As far as the $$$ coming right out of your paypal account there is no difference, however if you use it as a credit card ..YOU will recieve 1% back. This is NOT your money, this is money PayPal is paying you to use YOUR PayPal card as a credit card.
Example, you go out to dinner bill comes to 35.00, you give them your paypal debit card, (Most places will ask if it is debit or credit and if they don't Tell them credit)
Uses PayPal card as a Debit card
Bill 35.00
deduction from Paypal acct 35.00
Uses PayPal card as a Credit Card
Bill 35.00
Deduction from PayPal acct. 35.00
BONUS from PayPal +.35cents
Okay 35 cents isn't much but if you use your card as a credit card everywhere it adds up fast. This is FREE money from PayPal.
Cash Withdraw vs Cash Advance
Cash Withdraw, you can do at any POS or ATM as a debit card, you will NOT receive the 1% back.
Cash Advance, You can only do at YOUR bank I think. You have to take the card to the desk and tell the teller you want a CASH ADVANCE, not a withdraw.
To know the difference,
If you use your PIN# with your card then your using it as a debit card and will not recieve the 1% back on any purchases.
To use as a Credit Card you do NOT use your PIN# and always have to sign a reciept.
Hope that is clearer,