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Money and Banking (II)
Transcript of Money and Banking (II)
Money Transmission Factilities
Banks, building societies, credit unions and an post
Depends on the
amount of money and length of time
Bigger amount + long length of time = higher interest.
Three secure saving schemes
1. Index Linked National Instalment Savings
2. Saving bonds
3. National Saving Certificates
Interest on savings
Money and Banking (II)
Foreign Exchange Facilities
Transferring of money from one person to another
Current account holder
Very safe - record of payment
Chp 13 - full details next week
Today we will :
Revise over Forms of Money
Look at services offered by financial agencies
Discuss money in transmission
Form of a cheque which bank draws on itself
Used by both customers and non-customers
There is a record of payment
Standing Order (SO)
Current account holder -
bank/building society to take a
sum of money from their account and pay to someone else on a
Direct Debit (DD)
1. The amount may vary
2. Date decided by person/organisation
Used to pay club membership fees/electricity bills/telephone bills
Short quiz - Work on your own !
Then swap with person beside you for correction
Confusion on credit and debit cards
Watch video and be prepared to explain what you have learned
a Credit Transfer (CT)
No worries about paying bills - all done automatically
This allows a person to transfer money to a number of people or businesses
Person paying the money has to complete a bank giro form for each payment and pay the bank in full amounts
In order to complete a bank giro you need to:
Know the persons name and address
Bank Account numbers
Used by businesses who electronically pay their workers' wage
This method of paying wages is called 'Paypath'
Saves worker queing to buy a cheque
Now we will complete a crossword !
Building societies and Credit unions normally require a person to have saved with them before applying for a loan.
An Post offers
three secure saving schemes
which are not subject to
Deposit Interest Retention Tax (DIRT).
Index Linked National Instalment Savings
State guarantees a minimum return after five years
This will at least equal to the rate of inflation for that period
You must save a fixed sum each month for 12 months
Workers can join a
and request their employers to deduct money every week and send it to An Post (non-statutory deduction).
Minimum return after three years
National Saving Certificate
Minimum return after five years
Compound Annual Interest (CAR)
- calulated on the orginal sum borrowed
Compound annual interest (CAR)
- calulated on the orginal sum PLUS the interest earned to date
Tax on Savings
Deposit Interest Retention Tax
Tax must be paid on all interest earned on deposit accounts at 20%.
It is retained by financial agency and handed on to the government.
Hence the name given -
8% of €1,000
20% of €80
Interest after paying DIRT
Many countries are now using Euro - less foreign exchange.
Debit and credit cards.