How consumers use modern technology

Question 1

**Explain how consumers use tele-banking to conduct transactions

Answer 1

• tele-banking service e.g. loan payments, checking account balances, utility payments
• can be accessed by consumers without visiting a bank, via use of a cell phone
• requires a Personal Identification Number (PIN)

Question 2

How do consumers use ATMs to conduct transactions

Answer 2

• Automated Teller Machine
• located at banks and shopping outlets
• offers services such as money withdrawals and depositing cash
• requires a credit/debit card that comes with a PIN

Question 3

How do consumers use e-commerce to conduct transactions

Answer 3

• In electronic commerce
• buying and selling of goods through the internet and the world wide web

Question 4

How can customers use internet banking to conduct financial transactions

Answer 4

• Internet banking
• allows customers of a financial institution to carry out financial transactions and related activities on a secure website
• can make loan transfers, loan applications or payments, arrange payments to third parties
• can access account balances and statements to keep track of recent transactions
• required usename and password

Question 5

How do customers use debit cards to conduct transactions

Answer 5

• pay for goods at a point od sales without having to use cash
• card is linked to person’s bank account
• money is deducted from person’s account and transferred to seller’s account
• card ownership is verified by the Personal Identification Number (PIN)

Question 6

How do customers use credit cards to conduct transactions

Answer 6

• similar to debit cards
• different - the money amount is not deducted immediately from buyer’s account but at a given date in the month
• credit card holder can elect to pay off full balance each month or a set amount
• outstanding amounts attract interest

Question 7

Benefits of modern technology

Answer 7

• increased security
• convenience
• time-saving
• accessibility

Question 8

Potential Disadvantages of using modern technology for financial and commercial transactions

Answer 8

• harder to keep track of transactions, easier to overspend
• unpaid balances on credit cards have high interest
• customers subject to fraud if card lost or stolen
• may be open to fraud or identity theft

Question 9

How is it convenient to use modern technology in commercial transactions

Answer 9

• carry out transactions any time of day or night
• no longer need to physically visit bank or shop, travel or drive to locations
• for sellers - online shop is effectively oepn 24 hours

Question 10

How do buyers save time using modern technology?

Answer 10

people do not need to actually visit bank or store, have time associated with travelling

Question 11

Explain how modern technology helps accessibility

Answer 11

• person with computer and internet has access to many online services available
• not affected by their level of personal mobility eg if in wheelchair
• no need to have suitable transport available

Question 12

Explain increased security using modern technology

Answer 12

reduced need to carry and use cash, which can be more easily stolen