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Btec business > A2 Methods of payments - advantages and disadvantages > Flashcards

A2 Methods of payments - advantages and disadvantages Flashcards

1
Q

what are the 14 different payment methods

A

cash ,cheques, Debit cards , credit cards, Direct debit , standing order, Electronic transfer, pre - paid cards , contactless cards, charge card , store card, Mobile banking, Bacs , chaps.

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2
Q

what are the advantages of paying cash ?

A
  • most widely accepted form of exchange.
  • It is physical not virtual.
  • consumers feel confident when using cash.
  • makes budgeting easier.
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3
Q

what are the disadvantages of paying cash ?

A
  • inconvenience of transactions.
  • risk of counterfeiting.
  • cash not always accepted.
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4
Q

what are the advantages of cheques ?

A
  • enhanced security.
  • cost -effective.
  • cheques can be post dated to be used at later date.
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5
Q

what are the disadvantages of cheques ?

A
  • not legal tender.
  • outdated method of payments.
    • risk of fraud and bounced checks.
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6
Q

what are the advantages of debit cards ?

A
  • convenient and accessible.
  • security and fraud protection.
  • no debt accumulation.
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7
Q

what are the disadvantages of debit cards ?

A
  • limited fraud protection.
  • overdraft fees. -
  • no rewards .
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8
Q

what are the advantages of credit cards ?

A
  • credit card rewards.
  • fraud protection .
  • convenient.
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9
Q

what are the disadvantages of credit cards ?

A
  • paying high rates of interest.
  • credit damage.
  • annual fees
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10
Q

what are the advantages of direct debit ?

A
  • flexible.
  • time - saving
  • cost - effective.
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11
Q

what are the disadvantages of direct debit ?

A
  • easily get into a financial trouble
  • you can be charged overdraft or late fees.
  • controlled by a third party
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12
Q

what are the advantages of standing order ?

A
  • convenient.
  • you can control the amount and frequency of payment’s.
  • helps you manage budgeting.
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13
Q

what are the disadvantages of standing order ?

A
  • lack of flexibility.
  • payments delays and failures.
  • high maintenance.
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14
Q

what are the advantages of electronic transfer ?

A
  • safety and security.
  • speed and convenient.
  • instant access to funds or payments.
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15
Q

what are the disadvantages of electronic transfer ?

A
  • high transaction fees.
  • payment’s can get declined.
  • risk of fraud.
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16
Q

what are the advantages of pre - paid card ?

A
  • makes budgeting easier.
  • no credit checks.
  • travel - friendly.
17
Q

what are the disadvantages of a pre - paid card ?

A
  • certain locations do not accept.
  • no interest on money .
  • must pay a monthly maintenance fee.
18
Q

what are the advantages of contactless cards ?

A
  • faster and easier transactions
  • increased fraud and security prevention.
  • improved hygiene.
19
Q

what are the disadvantages of contactless card ?

A
  • security concerns .
  • low spending limit.
  • can lead to overspending.
20
Q

what are the advantages of charge card ?

A
  • financial discipline encourages responsible spending.
  • offer generous rewards, especially for travel and dining.
  • theft protection
21
Q

what are the disadvantages of charge card ?

A
  • not accepted everywhere.
  • offer an annual fee.
  • you can’t borrow for longer than a month.
22
Q

what are the advantages of store cards ?

A
  • exclusive discounts and vouchers.
  • early access to sales.
  • no annual fee.
23
Q

what are the disadvantages of store cards ?

A
  • you can only use the card with the particular store.
  • there are high interest charges.
  • may tempt you to overspend.
24
Q

what are the advantages of mobile banking ?

A
  • makes it easier to save money.
  • strengthened security.
  • you can check your account , any time and anywhere ?
25
Q

what are the disadvantages of mobile banking ?

A
  • risk of cybercriminals to attempting to breach the system.
  • relies heavy on technology.
  • extra charges for internet services.
26
Q

what are the advantages of BACS ?

A
  • safe and secure transactions.
  • inexpensive payments.
  • saves time.
27
Q

what are the disadvantages of BACS ?

A
  • slow processing time.
  • costs for businesses including setup and transaction fees.
  • inflexible timing.
28
Q

what are the advantages of CHAPS ?

A
  • highly secure
  • no upper limit for the amount that can be transferred.
  • guarantees same day payment
29
Q

what are the disadvantages of CHAPS ?

A
  • charge a fee
  • not suitable for small transfers.
  • limitied availability.
30
Q
A

Btec business (6 decks)

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