Level 3 Business Finance PDF

Level 3 Business Unit 3: Personal and Business Finance  Lesson Objectives Identify different types of available bank accounts Analyse the reasons why people create each type of account Evaluate the advantages and disadvantages of each account...

Level 3 Business Unit 3: Personal and Business Finance  Lesson Objectives Identify different types of available bank accounts Analyse the reasons why people create each type of account Evaluate the advantages and disadvantages of each account  Standard Current Accounts A current account, also known as a debit account, is the main account that the majority of people possess. The functions of this account include; Paying bills Having your wage/salary paid into it Benefits being paid into it Sending money through standing orders Banks offer a wide range of Current Accounts, with different features.  Packaged/Premium Packaged Current Accounts are where you receive additional benefits , for a monthly fee, including; Insurance, such as holiday, gadget and health. Breakdown cover Cashback Why do banks offer these accounts?  Basic Account A basic account has limited features and is mainly designed for individuals with poor credit ratings. No borrowing is allowed, in any form Some banks do not provide debit cards with these accounts. 1.2 million people do not have a bank account in the UK, these accounts are designed to help reduce this issue. HSBC Basic Account Type of Account Advantages Disadvantages Standard Convenient way to pay Potential high overdraft bills/receive payments. fees, no extra perks Services such as overdrafts, cash cards, cheque books. Packaged/Premium Offers a great range of Monthly fees can be perks, potentially saving high. Not all products you a lot of money. offered will be useful for Simplifies insurance as the account holder, they are in one place. potentially making the Same features of account lose its value for Standard accounts. money. Basic Gives people with a low Very basic features, no credit rating a bank debit card or overdrafts account. No borrowing is allowed. allowed, helping people control their money.  Student Accounts University students are offered student accounts, which have a variety of benefits; Large overdrafts Railcards Cashback on purchases Discounts What are the advantages and disadvantages of Student Accounts? These accounts can be converted into a regular account after studying ends.  Task In groups, research each of these types of accounts. For each account, write a profile of a typical customer for the account, providing details on their circumstances and the reasons they want the account. Assess other group’s profiles, have they picked appropriate accounts?