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Topic 3 - Coggle Diagram
Topic 3
A cheque is a payment mechanism that enables an account holder to instruct their
provider to pay a specific amount of money to a specific person or organisation.
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Providers cannot honour cheques (that is, make the payment specified
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Standing orders are instructions to pay the same amount of money to another
account on a regular basis, such as the 5th of every month.
Direct debits are another type of automatic payment that can be set up for a current
account
Online banking enables account holders to give instructions for account transactions
via the internet.
Faster Payments is an electronic payment service offered by all UK banks and building
societies
CHAPS (Clearing House Automated Payment System) is a same-day automated
payment system used for very high value payments.
Mobile banking enables account holders to give payment instructions on their mobile
phone using the internet
Online payment services, such as PayPal, enable people to pay each other without
exchanging current account details.
The advantages of electronic payments are that they are fast, safe and convenient to
make.
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account to another account on a specific date. Instructions can be given on paper,
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People tend to use cash for everyday, low-value transactions
when they are in face-to-face situations with the sellers.
Although payment cards are used in more transactions than ever before, cash is still
used in just under a quarter of UK transactions (UK Finance, 2020), though this figure
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Disadvantage of cash;The transaction is not made face-to-face with the seller◆ Some sellers prefer other payment methods –
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These are pre-printed cheques for set amounts of currency, such as 50, 100 or 500
US dollars.
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Plastic payment cards are another payment mechanism that enables account holders
to give their provider instructions to pay money from an account.