Card payments and what they cost
Taking cards is quick, but the card provider keeps a fee from every sale. Work out the fee and record it.
In this room: 3 tasks, 10 questions
- Debit cards and credit cards3 questions
- The fee on one sale4 questions
- Comparing two providers3 questions
With a debit card, the money comes straight out of the buyer's bank account. With a credit card, the card company pays, and the buyer settles the card bill later.
Either way the seller is paid by its card provider, usually within a few working days.
A business can pay by card too. Anything bought on a business credit card is owed to the card company until the bill is paid, so it is a liability.
Answer the questions below
2 more questions follow in this task.
The card provider charges the seller a fee on every card sale. It is usually a percentage of the sale.
Fernhill's provider charges 1.5% here. A customer pays £240 by card for a repair.
The sale is still recorded in full. The fee is a separate expense, and only the rest reaches the bank.
Answer the questions below
3 more questions follow in this task.
Some providers also charge a fixed amount for each transaction. In May Fernhill took £8,400 by card, in 320 transactions.
| Provider | Percentage of sales | Fixed fee for each transaction |
|---|---|---|
| A | 1.5% | None |
| B | 1% | £0.10 |
Answer the questions below
2 more questions follow in this task.