Personal Bankng Flashcards
Current Account
allows you to lodge and withdraw money at any time. This account is used for day-to-day transactions.
Lodge: putting money into a bank account
Withdraw: taking money out of bank account
What does Atm stand for?
Automated Teller Machine
ATM
a machine used to withdraw money from a person’s current account. The correct card and PIN (Personal Identification Number) must be entered. The machine reads the card chip and the customer enters their secret PIN. This is to prevent a stolen card from being used.
ATM Services:
Withdraw Cash Pay bills Check Account Balance Order bank statement Buy mobile phone credit
Debit Card
This allows money to be transferred
electronically from the customer’s bank account
to the retailer’s bank account. The customer
must enter their PIN.
The amount is taken instantly from the
Customer’s bank account. If there is not
enough money in the bank account the card will be declined.
Advantage: Safe and Convenient way to pay for goods
Debit card
Buy now pay now
Example: Visa debit
Credit card
Buy now pay later
Example: Mastercard
Cheque
A written instruction to a bank to pay a stated sum of money from your bank account to a named person.
If there is not enough money in the
account of the person who wrote the
Cheque, the cheque will “bounce”.
This means that the payment cannot be made.
Credit Transfer (CT)
Allows you to transfer money from your own bank account to another person’s bank account.
This can be done in the bank branch
by completing a giro or online
banking
Bank Draft
A written document that tells the bank to pay a stated sum of money to a named person.
it is written by the bank and guaranteed not to bounce as you pay the money in advance.
It is a common way to pay for expensive items like cars and houses.
Paypath
Electronic way of transferring an employee’s wages from employer’s bank account to employee’s bank account.
Advantage for Employer of Paypath
Safer for Employer as they do not need to handle large amounts of cash on payday.
Advantage for Employee of paypath
Saves Employee time as the money is already in their bank account
Overdraft
This is permission to withdraw
money for more than the balance of money
in your current account. Only up to a
certain limit.
Advantages of Overdraft
Convenient to pay for household items in the short term
