How many types of finanical organisations are there and what are they?
9,
Bank of England, Banks, Building societies, Credit union, National Savings and income, Insurance companies, Pension companies, Pawnbrokers, Payday loan Companies
How does the Bank of England relate to the personal finance sector?
- regulates and supervises all financial institutions
- responsible for the UK’s monetary value and stability
- sets interest rates
independent from government
How do banks relate to the personal finance sector
- owned by shareholders
- offer customers a range of financial services
- reliable, secure and private
- may charge for certain services
- if bank fails up to £85,000 is safe
How does Building societies relate to the personal finance sector?
- owned by members
- provide financial services
- could offer better interest and saving rates than banks
- fewer branches
How does credit unions relate to the personal finance sector?
- owned and run by members
- non profit
- offer savings + current accounts and loans
- limited funds
- good cooperation and grouo feeling
How does NS+I relate to the personal finance sector?
- some services can be accessed in a high street post office
- Sells savings and investment products
- invested in products used to finance government activities
- poor interest rates
How do isnurance companies relate to the personal finance sector?
- offer policies compensating holders against unideal situations
- also have life insurance mixed with pensions plans
How do pensions companies relate to the personal finance sector?
- projected income uses figures that change over time
- funds locked up and penalties received if money is taken out early
- businesses sell these allowing customers to prepare for retirement
How do pawn brokers relate to the personal finance sector?
- high short term cost
- instant cash available
- pawned items may be sold if not bought back in a certain time
- interest us charged on the loans
- indivudals or businesses asses item and decide how much it is worth
How do pay day loan companies relate to the personal finance sector?
- very expensive and easy to get into debt
- immediate cash available
- business that offers people short term cash between pay days
What are the 5 ways of customer communications?
Bank Branch
Telephone Banking
Online Banking
Postal Banking
Mobile Banking
What does mobile banking offer?
manage account through phone, 24/7 service available, efficient but has security concerns
What does postal banking offer?
send paper copies of clients statements, can also pay chequs though post, but these can be delayed in the post, useful for those without internet access.
What does telephone banking offer?
simple transactions available 24/7, can speak directly to an adviser, efficient automated services, oversea call centres may not be useful
What does online banking offer?
Manage accounts on their computer, can check balance, pay bills and transfer money 24/7, but can not pay in or draw out cash
What do bank branches offer?
over counter transactions, machije or actual person, take cash out or put it in., has open and closing hours. have to travel to get there.
What are the role, function and responsibility of Financial Conduct Authorty?
- authoirse business trade and supervise work and practice with force
- resposnible for customers are provided with products and services
- independent body funded by organisations
What are the role, function and responsibility of Financial Ombudsman Services?
- give advice on decisions mad eby facts
- service set up by law
What are the role, function and responsibility of Financial Services Compensation Scheme?
- fund can pay compensation to consumers for financial lss if a business is unable to pay claims against it
- covers claims against business authorised by the FCA
What is consumer credit legalisation?
regulates credit card purchases and gives consumer protection when signing loan and hire purchase agreements
What is the Office of Fair Trading?
an office protecting consumer interests now responsible for the FCA
What are the 6 types of consumer advice?
- citizens advice
- Independent Financial Advisers
- Price Comparison Websites
- Debt Counsellors
- The Money Advice Service
- Individual Voluntary Arrangements and bankruptcy
Whats an advantage and disadvantage of Citizens advice?
+ helpful for low income citizens and useful first point of call
- advisers are volunteers not professionals, so could struggle with complex situations
Whats an advantage and disadvantage of Independent Financial Advisers?
+ do not recieve comission
-IFAs charge for service
