Methods of Payment

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  • Methods of Payment
    • Cash
      • Buying low price items
      • Notes and Coins
      • Makes budgeting easier/Can be stolen or lost
    • Debit Card
      • Pays from a current account directly
      • Doesn't require carrying cash/Not appropriate for small transactions
    • Credit Card
      • Allows delaying of payment
      • Offers degree of protection/Encourages overspending
      • Pay for a brand new TV
    • Cheque
      • Makes payment of specific amount of money to specific account
      • Low risk/Error on writing can easily become problem
      • Paying rent
    • Electronic Transfer
      • Transferred directly between accounts
      • Almost instantaneous/If incorrect set up can be lost
      • Switching money between accounts (e.g. personal to savings)
    • Direct Debit
      • Allows third party to withdrawn on set date
      • Amount payed can vary/Payer has responsibility to check for mistakes
      • Bills
    • BACS
      • Instant transfers within 2 hours/Limited amount per transaction
    • Mobile Banking
      • Carrying out financial transactions through the phone
      • Convenient/Limited features
      • Check account balance
    • Contactless Cards
      • Allows money transfer through touching on pad
      • Gaining popularity/only small transactions
      • Grocery Shopping
    • CHAPS
      • Allows direct transfer of money between accounts
        • BACS
          • Instant transfers within 2 hours/Limited amount per transaction
      • No amount limit/Fixed charge per transaction
    • Store Card
      • Delaying payments of specific shop
        • Clothing
      • Offers discounts/ Interest is high
    • Standing Order
      • Fixed sum of money is payed on set date
      • Easier to plan and budget/there is no regard to payers account balance
      • Phone bill
    • Pre-paid Cards
      • Money is uploaded to card
      • Can set budget/If lost or stolen there is no protection
      • Shopping
  • Definition
  • Advantage/Disadvantage
  • Example

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