Payment methods
credit
postives
Credit is the supply of money now in return for the promise of paying it back later
Offer a cheap use of the funds (provided you always pay it back in full)
Avoid the hassle of carrying around large amount of cash and instead you can just carry it all around in one card conveniently
A convenient payment method for online or over the phone purchases
negatives
Can be more expensive than other forms of credit such as a personal loan
You can loose it more easily than a wad of cash
It will damage your credit rating if you dont pay it back on time
Cash
The notes and money issued by the federal government
Consumers normally use cash for inexpensive purchases
Electronic Funds Transfer: Debit cards and Bpay
It is rarely used for expensive items like cars and houses
Direct debit
Debit cards
You pay no interest, only an account operating fee
With a debit cards, you are electronically accessing money already in your account
You can only use as much money that is your account unless you put more in
Bpay
Bpay is another form of electronic payment used to pay bills
This system transfers funds from your bank account the the bank account you wish to pay
Many consumers have bills that arrive at regular intervals such as a telephone, electricity or car insurance
By using a direct debit system, you can schedule bill payments from your nominated bank account automatically
Cheques
Lay by
A cheque is a written communication ordering your financial institution (bank), to pay a business or person a specific amount of money
Book up
When writing a cheque no blank spaces should be left to avoid extra numbers being added later on
When you buy goods using lay by, you first pay a deposit to the shop who pulls aside the good for you
You then make payments over a fixed period of time
You are not allowed to take the goods home until you pay the last installment
Book up is credit provided by a retailer so that you can purchase goods from the store, take them straight away then pay at a later date
This form of payment is commonly used between hardware stores and tradespeople (builders, plumbers etc)