Understanding Credit Card Fees and Payments

The video explores various payment methods available at shops, including debit cards, cash, and gift cards. It clarifies non-payment methods like layby and discusses the limitations of using credit cards, such as minimum purchase requirements. From a vendor's perspective, the video explains the costs associated with accepting different payment methods, particularly focusing on surcharges from credit card companies like American Express. It concludes with strategies vendors use to adjust prices to cover these costs, highlighting the concept of cash discounts.

Which of the following is NOT a form of payment discussed in the video?

• Layby

• Gift card

• Cash

• Debit card

What does FP stand for in the context of payment methods?

• Financial Payment

• Funds Processing

• Fast Payment

• Funds Transfer

Which payment method is becoming less common according to the video?

• Debit card

• Cash

• Gift card

• Check

Why might a business refuse to accept a credit card for small purchases?

• To increase sales volume

• To promote debit card usage

• To avoid high transaction fees

• To encourage cash payments

What is a surcharge in the context of credit card payments?

• A tax on electronic transactions

• A reward for frequent purchases

• An extra fee for using a credit card

• A discount for using cash

What is the primary business model for credit card companies?

• Offering rewards programs

• Charging customers annual fees

• Earning interest on unpaid balances

• Charging businesses transaction fees

Why might a business choose not to accept American Express cards?

• They are not widely used

• They have higher transaction fees

• They are not secure

• They require special equipment

How do businesses typically adjust their pricing to cover the costs of accepting credit card payments?

• By increasing the price of all items slightly

• By reducing the quality of products

• By charging a flat fee for card transactions

• By offering discounts for cash payments

What is the main reason businesses might offer a discount for cash payments?

• To reduce the use of electronic payments

• To avoid paying transaction fees

• To speed up the checkout process

• To increase customer loyalty

What is one way businesses compensate for the cost of credit card transactions?

• By offering more sales promotions

• By limiting store hours

• By increasing product prices

• By reducing employee wages