Topic 3

Question 1

ATM

Answer 1

Automated Teller Machine, also known as a cash machine.

Question 2

Bacs

Answer 2

The central payment system used to process different types of electronic payment.

Question 3

Banker’s Draft

Answer 3

Similar to a cheque but the payment is signed and guaranteed by the financial services provider that issues it rather than the individual. Used for paying large sums of money.

Question 4

Cashback

Answer 4

A service offered by some retailers when the customer pays by card. The retailer gives the customer cash and debits the amount of cash handed over from the customer’s payment card.

Question 5

Cash Card

Answer 5

A card used to withdraw cash from ATMs or branch counters

Question 6

CHAPS

Answer 6

Clearing House Automated Payment System, a same day payment system for high value transactions, such as buying a house

Question 7

Cheque

Answer 7

A written instructor to a financial services provider to pay a specified amount to a specified person or organisation.

Question 8

Contactless Card

Answer 8

A card that can be read simply by holding it in front of a card reader, used for low-value payments.

Question 9

Debit Card

Answer 9

A card that can be used to withdraw cash, to make face-to-face transactions, e.g. shops, and to make payments online or over the phone.

Question 10

Direct credit

Answer 10

An electronic payment into an account, such as a salary or benefit payment.

Question 11

Direct debit

Answer 11

Am electronic payment out of an account. The amount and frequency can vary.

Question 12

Faster Payments

Answer 12

An electronic payment service that enables payments to be made within 2 hours.

Question 13

Mandate

Answer 13

A paper or online instruction to a provider to make a payment from an account

Question 14

Prepaid Cards

Answer 14

A card that must have money credited to it before the holder can use it to pay for goods. Once the initial sum has run out, it can be topped up again. Some are loaded with foreign currency and used abroad.

Question 15

Standing order

Answer 15

An electronic payment out of an account. Used to make regular payments of the same amount.

Question 16

Transaction

Answer 16

Buying or selling something.

Question 17

Transaction Need

Answer 17

The reason why someone needs to make a payment, e.g. needing to top up your phone

Question 18

Traveller’s cheque

Answer 18

A pre-printed cheque for a set amount of currency, e.g. $50 or $100. Can be exchanged for local currency or used to make payments whilst abroad.