Text 3: Bank Cards

There are a few types of bank cards. The most popular are credit cards and cash cards, which look very much alike. Here is the face and the back of a sample cash card:

Cash dispenser, automatic teller machine or cashpoint are some of the names given to machines from which customers can withdraw money from their bank accounts, using their cash cards.

If customers want to pay for goods or services by cheque, they can use their card to guarantee their cheques. In a shop the salesperson will ask to see the bank card or cheque guaranteed card. The salesperson will write down the number of the customer's bank card on the back of the cheque. In this way the customer's bank guarantees payments up to a 50 or 100 limit. The salesperson also makes sure that the customer's signature on the cheque is the same as the signature on their bank card. The sort code of the bank is also on the bank card. This number, and the name of the bank, should be the same as on the cheque.

Credit cards are also very convenient because it is possible to buy things in shops, pay with for different services and so on. When a customer pays for his purchases in a shop, for example, he presents his credit card to the seller. The seller takes the details of the card: the number, the credit limit and the expiry date. The customer signs the seller's voucher (making two copies) which the seller uses to collect payment from the credit card company or the bank later.

For this service the retailer pays a fee, around 4 per cent of the value of the transaction. Each month the credit company or the bank sends the cardholder a statement which lists that month's transactions and interest charges.

When the company or the bank receives the vouchers it pays the banks of the payees through the clearing system the value of each retailer's total sales minus the commission. At the same time it debits the cardholders' accounts.