LIBF Unit 1 Key Terms Revision

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Administration Order
A repayment plan arranged by courts in England, Wales and Northern Ireland for people with less than £5000 in unsecured debt and at least one county court judgement against them.
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AER
Interest that will be earned on the money in one year and takes into account how often the provider pays interest, the effect of compounding the interest and any fees and charges.
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APR
The total cost of borrowing over one year, including the interest charged and fees.
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BACS
The central payment system used to process different types of electronic payment.
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Banker's Draft
Similar to a cheque but the payment is signed and guaranteed by the financial services provider.
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Bank Rate
The interest rate that the Bank of England uses when it lends money to other banks - financial services take note of this when setting rates on their own services.
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Bankruptcy
When a person cannot pay their debts and is the subject of a court order that shares out their assets between their creditors.
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Barter
Exchanging goods and services for other goods and services without using money.
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Capital
The money or other assets owned by an individual or a business (for a financial services provider: it refers to funds provided by shareholders - not deposits from customers)
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CVV
The 3 number son the back of a card for security measure.
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Cashback Card
Type of card that gives back to the card holder a percentage of the value of transactions made with the card - in the form of cash.
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Cash ISA
An account that pays interest tax free on cash savings up to a certain level .
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CHancellor of the Exchequer
The British cabinet minister who is responsible for financial and economic matters and in charge of the treasury.
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CHAPS
A same day payment system for high value transactions, such as a house purchase.
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Charge Card
A credit card that must be charged in full every month.
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Children's Bond
An investment bond taken out by a parent, guardian for children under the age of 16. Investing in £25-£3000. The investor is guaranteed interest at a fixed rate for 5 years, after which the bond matters.
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CTF
Child Trust Fund - long term savings account only available for children born between 1st Sep 2002 and 2 jan 2011. It was set up t encourage people to build up savings for their children.
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Citizens Advice
Providing free, independent, confidential advice.
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CMA
Competitions and Markets Authority - an independent, non ministerial government department, which works to promote competition between providers so that consumer's benefit.
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Consolidation Loan
A loan used to pay off a number of different debts - meanings that there is then only one payment to make each month, to the loan company.
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Consumer Credit
Term used for borrowing - taking credit or buying on credit refers to borrowing.
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CPI
Consumer Prices Index - A way in which the government measures inflation. It is calculated by checking the price of a representative sample of goods on a monthly basis -this enables statisticians to measure how much prices are rising or falling.
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Consumer rights act 2015
This sets out the basic rules which govern how consumers buy and businesses sell to them in the UK.
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CCJ
County Court Judgement - in England and Wales - a judgement issues by a county court to a person who does not respond to court action from a person or organisation to which they owe money. The CCJ affirms that the money is owed.
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Credit agreement
Formal agreement between a provider and a borrower setting out the amount borrowed, the interest charged, the arrangement for repayment and any other terms an conditions.
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Creditor
A person or organisation to which someone owes money.
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A credit union
A mutual organisation (that is owned by its members) that provides a range of financial products e.g. savings accounts or personal loans members. Members share common bond e.g. work.
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DMC
Debt Management Company - An organisation to which a person in debt (debtor) pays what they can afford each month. They then pay the creditors.
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Debt Management Plan
A plan drawn up by a DMC and sent to an individual creditors. It sets out an affordable monthly payment shared between the creditors.
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Other cards in this set

Card 2

Front

Interest that will be earned on the money in one year and takes into account how often the provider pays interest, the effect of compounding the interest and any fees and charges.

Back

AER

Card 3

Front

The total cost of borrowing over one year, including the interest charged and fees.

Back

Preview of the back of card 3

Card 4

Front

The central payment system used to process different types of electronic payment.

Back

Preview of the back of card 4

Card 5

Front

Similar to a cheque but the payment is signed and guaranteed by the financial services provider.

Back

Preview of the back of card 5
View more cards

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