B Personal Finance Sector

Question 1

Bank of England

Answer 1

Bank of England

The UK’s central bank – responsible for maintaining a healthy level of financial stability for the UK as a whole

Question 2

Banks

Answer 2

Banks

Handles financial transactions and stores money on behalf of its customers

Question 3

Building societies

Answer 3

Building societies

Handle financial transactions and store money on behalf of their members

Question 4

Credit unions

Answer 4

Credit unions
Not-for-profit organisations that handle financial transactions and store money on behalf of their members. Members are the owners.

Question 5

National Saving and Investments

Answer 5

National Saving and Investments

A government back organisation that offers a secure saving option

Question 6

Insurance companies

These are businesses that protect against the risk of loss in return for a premium

Answer 6

Insurance companies

These are businesses that protect against the risk of loss in return for a premium

Question 7

Pension companies

Answer 7

Pension companies
Businesses that sell policies to individuals, either privately or through employers, to allow them to save now to fund retirement in the future

Question 8

Pawnbrokers

Answer 8

Pawnbrokers

Businesses or individuals who loan money against the security of a personal asset, e.g. an item of jewellery.

Question 9

Payday loans

Answer 9

Payday loans
Organisations that offer a short-term source of finance used to bridge the gap between now and the next pay day.
Using for small amounts at very high rates of interest.

Question 10

Methods of interacting with customers

Answer 10

Methods of interacting with customers 
Branch
Online banking
Telephone banking
Mobile banking
Postal banking

Question 11

The Financial Conduct Authority (FCA)

Answer 11

The Financial Conduct Authority (FCA)

The FCA is an independent organisation, funded by membership fees charged to financial service providers.

Question 12

Financial Ombudsman Service (FOS)

Answer 12

Financial Ombudsman Service (FOS)

Appointed by the government to represent consumer in disputes with financial service providers.

Question 13

The Financial Service Compensation Scheme (FSCS)

Answer 13

The Financial Service Compensation Scheme (FSCS)
If the financial service providers is unable to pay compensation to a consumer, e.g. it is bankrupt, the FSCS will do so.

Question 14

Office of Fair Trading (OFT)

Answer 14

Office of Fair Trading (OFT)
A government organisation established to regulate all markets – including financial markets.
It is now part of the FCA.

Question 15

Consumer Credit Legislation

Answer 15

Consumer Credit Legislation

Laws passed by the UK government to enforce the regulation of any organisation offering credit to consumers

Question 16

Citizens Advice

Answer 16

Citizens Advice

Run by charities – offers advice on a wide range of financial issues

Question 17

Independent Financial Advisor (IFA)

Answer 17

Independent Financial Advisor (IFA)
Professionals who offer independent advice to their clients on financial matters, e.g. savings, investments, mortgages and pensions

Question 18

Price Comparison Websites

Answer 18

Price Comparison Websites
Prices are collated for similar goods/services within an industry allowing consumers to make comparisons and find the best deals

Question 19

Money Advice Service

Answer 19

Money Advice Service

A government organisation – offers free and impartial financial advice.

Question 20

Debt Counsellors

Answer 20

Debt Counsellors

A professional who offers independent advice on how best to manage debt

Question 21

Individual Voluntary Arrangements (IVAs) bankruptcy

Answer 21

Individual Voluntary Arrangements (IVAs) bankruptcy
Government organisation – that allows individuals to declare themselves bankrupt – whilst agreeing to pay part or all of the money they owed to creditors though an insolvency practitioner