Methods of payments

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  • Methods of payment
    • Direct debit cards
      • Can only spend what is in the account, so you have to save up in order to buy
      • Safer and less chance of fraud
      • Cant over spend
    • Cash
      • Usually accepted everywhere
      • No interest charges
      • When lost or stolen its difficult to trace
    • Credit cards
      • Spending spread over a period of time
      • Interest charges can be  high
      • Can be used world wide
      • Fraud is a problem
    • Hire purchase agreements
      • Interest is high
      • You don't need the money up front
      • Goods can be taken away if the consumer cannot pay
    • Credit agreements
      • Some agreements can be interest free
      • Some interest rates can be very high
      • Mortgages is a long term example
    • Bank overdraft
      • Interest is only charged on overdrawn amount
      • Helpful to cover emergency expenditure
      • If permanent  it may be a costly way to finance expenditure
    • Direct debits and standing order payments
      • Fixed regular payments e.g. rent, mortgage
      • Helps with budgeting

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