Topic 8 Key terms(comsumer protection)

Question 1

Capital

Answer 1

definition:The money or other assets owned by an individual or business,refers to the funds provided by the shareholders, not deposits from customers

Question 2

chancellor of exchequer

Answer 2

definition: The British Cabinet minister responsible for financial and economic matters and in charge of the Treasury

Question 3

citizens advice

Answer 3

definition: A charity providing free, independent, confidential and impartial
advice on citizens’ and consumers’ rights and responsibilities

Question 4

competition and markets authority(CMA)

Answer 4

definition:an independent,non-ministerial government department which works to promote competition between providers so that customers benefit

Question 5

consumer credits

Answer 5

definition:another term for borrowing, ‘taking credit’ or “buying on credit’ refers to borrowing.Credit into a bank account means paying money in

Question 6

credit crunch

Answer 6

definition: reduction in the availability of loans or a tightening of the conditions needed to obtain one

Question 7

credit union

Answer 7

definition:mutual organisations that provides a range of financial products, people in credit union must share common bond

Question 8

current account

Answer 8

definition: Bank or building society accounts where people can store their
money in the form of electronic balances and withdraw it to make payments

Question 9

debit card

Answer 9

definition: card that can be used to withdraw cash, to make face-to-face
transactions in, for example, shops and online

Question 10

deposit

Answer 10

definition: sum of money placed by a customer with a financial services
provider

Question 11

financial conduct authority(FCA)

Answer 11

definition: One of the two main regulators of financial services in the UK
(the other is the Prudential Regulation Authority)

Question 12

financial ombudsman service(FOS)

Answer 12

definition:An independent body set up by Parliament that settles customer
complaints about providers at no charge to consumers

Question 13

financial policy committee(FPC)

Answer 13

definition: part of the Bank of England that monitors and responds to risk posed to the entire financial services market

Question 14

financial services compensation scheme(FSCS)

Answer 14

definition: compensation scheme that pays compensation to account
holders of up to a certain amount per provider if the provider goes into default

Question 15

independent commission on banking(ICB)

Answer 15

definition: committee formed in June 2010,response to the global financial crisis. It considered reforms to the UK banking sector to promote both financal stabilty and competition

Question 16

independent financial adviser(IFA)

Answer 16

definition: professional who makes financial recommendations to clients,
based on available products across a wide range of providers

Question 17

investment banks

Answer 17

definition: Banks that are involved in trading financial assets such as shares, underwriting issues of shares by other institutions and advising on mergers and acquisitions

Question 18

liquidity

Answer 18

definition: assets that a business holds in the form of cash, that can be used to meet immediate demands for payment

Question 19

money helper

Answer 19

definition: independent organisation set up by the government to support people to make the most of their money and pensions.

Question 20

money laundering

Answer 20

definition: process of making ‘dirty’ money ‘clean’,making it look as though it has been acquired legitimately

Question 21

mortgage

Answer 21

definition: A loan taken out to pay for a property, usually over a long term

Question 22

office of fair trading(OFT)

Answer 22

definition: government department that monitored how businesses compete with each other,abolished in April 2014 and responsibilities now shared between the Financial Conduct Authority and the Competition and Markets Authority

Question 23

overdraft

Answer 23

definition: facility that allows an account holder to withdraw more money than they actually have in their account,authorised overdraft is agreed with the bank in advance within certain limits,exceeding those limits or going overdrawn without permission is an unauthorised overdraft

Question 24

payday loan

Answer 24

definition: loan designed to be taken out for only a very short period, which charges a very high APR

Question 25

payment protection insurance(PPI)

Answer 25

definition: insurance product intended to ensure repayment of loans should a borrower face unexpected events that prevent them from repaying the debt

Question 26

prudential regulations authority(PRA)

Answer 26

definition: One of the two main regulators of financial services in the UK
(the other is the Financial Conduct Authority)

Question 27

retail bankers

Answer 27

definition: Banks that deal directly with consumers, for example providing
current accounts and mortgages

Question 28

standards of lending practices

Answer 28

definition: voluntary code of conduct that sets out good practice for the
provision of advice about loans, credit cards, charge cards and current account overdrafts.

Question 29

sub-prime market

Answer 29

definition: Lending to and borrowing by consumers with untested or poor
credit histories

Question 30

transaction

Answer 30

definition: Buying or selling something