A2: Different ways to pay

Question 1

The advantages and disadvantages of cash

Physical method of payment (notes/coins)

Answer 1

Advantages:
Less likely to get scammed
Majority of stores accept it

Disadvantages:
Loss/ theft
Cannot be used online

Question 2

The advantages and disadvantages of a debit card

Virtual method of payment that allows to transfer money eletronically

Answer 2

Advantages:
Secure payment
No fee to have one

Disadvantages:
Minimum spend in most stores
Risk of overspending

Question 3

The advantages and disadvantages of credit card

Virtual method of payment with money from a bank electronically

Answer 3

Advantages:
Can pay for items without spending your actual money
Builds credit score

Disadvantages:
Must pay back with interest
Maintenance fees

Question 4

The advantages and disadvantages of Cheque

An order to a bank to pay a sum from the drawers acc on a written form

Answer 4

Advantages:
Instant access to funds
No need to carry large sums of money

Disadvantages:
Risk of theft
Not suitable for small amounts of money

Question 5

The advantages and disadvantages of electronic transfer

Tranfers money across to people, banks and businesses

Answer 5

Advantages:
Faster to send money to others
Shows record of transaction

Disadvantages:
Risk of loss during wire transfer
Lack of anonymity

Question 6

The advantages and disadvantages of direct debit

Arrangment that allows a bank to use a third party to exchange money.

This is at agreed dates

Answer 6

Advantages:
Never misses a payment
Saves time

Disadvantages:
Less control for transferring money
Risk of forgetting payments

Question 7

The advantages and disadvantages of standing order

An order to a bank by the account holder to make regular fixed payments

This is to a certain person

Answer 7

Advantages:
Pay bills on time
Free of charge

Disadvantages:
No guarantee
Lack of flexibility

Question 8

The advantages and disadvantages of a pre-paid card

Function between cash and bank cards as an everyday use

Answer 8

Advantages:
Efficient to use
Can load and withdraw money from the card

Disadvantages:
Restrictions on usage
Risk of theft

Question 9

The advantages and disadvantages of contactless card

A payment method by tapping a card on a point-of-sale terminal.

Answer 9

Advantages:
Secure payment
Quicker transactions

Disadvantages:
Risk of malware attacks
Limit of £100 transactions

Question 10

The advantages and disadvantages of a charge card

An electronic payment that requires a statement of pay owed on the card

Answer 10

Advantages:
No interest
Builds good credit history when paid

Disadvantages:
High interest when not paid
Not accepted as a for of payment in all stores

Question 11

The advantages and disadvantages of a store card

A payment for a store with the money being taken away from you later

Answer 11

Advantages:
No maintenance fees
Exclusive perks

Disadvantages:
Low credit limits
Limited to 1 store

Question 12

The advantages and disadvantages of mobile banking

Provided by a bank allowing users to make transactions remotely on phone

Answer 12

Advantages:
Quick payments
Account security

Disadvantages:
Dependant on technology
Risk of cyberattacks

Question 13

The advantages and disadvantages of BACs
(Bankers automated Clearing services)

Regulated payment that moves money electronically to specific accounts

Answer 13

Advantages:
Secure transactions
Inexpensive payments

Disadvantages:
Slow processing
Strict cut-off times for when sending payments

Question 14

The advantages and disadvantages of CHAPS
(Clearing house automated payment system)

Provides transactions that allow individuals+businesses to make payments

Answer 14

Advantages:
Fast
Secure

Disadvantages:
Difficult to cancel
Expensive