Moodle Version Making And Receiving Pay
Methods of Payment
Payment
There are 5 commonly accepted methods of payment:
Cash
Cash
BACS
BACS
Credit Cards
Credit Cards
Cheques
Cheques
Debit Cards
Debit Cards
© Business Studies Online: Slide 1
Which Methods Are Most Popular?
Popular?
45,000
40,000
Cash
T ra n s a c t io n s ( M illio n s )
35,000
30,000
25,000
20,000
Cheques
15,000
BACS
10,000
Credit Cards
5,000
Debit Cards
0
1995
1996
1997
1998
1999
2000
Year
2001
2002
2003
2004
Source: Apacs
© Business Studies Online: Slide 2
Cash
Cash is a popular form of payment with customers because: Transactions are completed immediately Cash can be reused for other transactions immediately
© Business Studies Online: Slide 3
Advantages & Disadvantage of Using Cash
Advantages
Disadvantages
Payment is made straightaway
Cash has to be counted
Ideal for small purchases
Has to be locked away for security Convenient
Can be Stolen
© Business Studies Online: Slide 4
Cheques
Cheques
A paperbased form of payment
Effectively a promise to pay the amount stated
Cheques must be presented to a bank in order to obtain the payment
It usually takes at least 3 working days for a cheque to “clear” – i.e. payment to be received
© Business Studies Online: Slide 5
Advantages & Disadvantages of Cheques
Advantages
Disadvantages
Safer than cash
Takes time to clear
Better for large amounts
It can “bounce”
Cheaper than cash to operate with Errors can result in bank refusing cheque
© Business Studies Online: Slide 6
Debit Cards
Cards
A plastic card, issued by the bank, which allows payment to be made without writing a cheque or carrying cash
It works as follows:
Customer hands over debit card
Shop assistant puts card in chip and pin machine
The amount is taken electronically from customer‛s account and added to business's account
(takes 3 days)
© Business Studies Online: Slide 7
Advantages & Disadvantages of Debit Cards
Payment
There are 5 commonly accepted methods of payment:
Cash
Cash
BACS
BACS
Credit Cards
Credit Cards
Cheques
Cheques
Debit Cards
Debit Cards
© Business Studies Online: Slide 1
Which Methods Are Most Popular?
Popular?
45,000
40,000
Cash
T ra n s a c t io n s ( M illio n s )
35,000
30,000
25,000
20,000
Cheques
15,000
BACS
10,000
Credit Cards
5,000
Debit Cards
0
1995
1996
1997
1998
1999
2000
Year
2001
2002
2003
2004
Source: Apacs
© Business Studies Online: Slide 2
Cash
Cash is a popular form of payment with customers because: Transactions are completed immediately Cash can be reused for other transactions immediately
© Business Studies Online: Slide 3
Advantages & Disadvantage of Using Cash
Advantages
Disadvantages
Payment is made straightaway
Cash has to be counted
Ideal for small purchases
Has to be locked away for security Convenient
Can be Stolen
© Business Studies Online: Slide 4
Cheques
Cheques
A paperbased form of payment
Effectively a promise to pay the amount stated
Cheques must be presented to a bank in order to obtain the payment
It usually takes at least 3 working days for a cheque to “clear” – i.e. payment to be received
© Business Studies Online: Slide 5
Advantages & Disadvantages of Cheques
Advantages
Disadvantages
Safer than cash
Takes time to clear
Better for large amounts
It can “bounce”
Cheaper than cash to operate with Errors can result in bank refusing cheque
© Business Studies Online: Slide 6
Debit Cards
Cards
A plastic card, issued by the bank, which allows payment to be made without writing a cheque or carrying cash
It works as follows:
Customer hands over debit card
Shop assistant puts card in chip and pin machine
The amount is taken electronically from customer‛s account and added to business's account
(takes 3 days)
© Business Studies Online: Slide 7
Advantages & Disadvantages of Debit Cards