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4.1.6(c) Uses of ICT in the home/ 2 Online Banking. Starter. What do banks offer to their customers?. What does a bank do?. Many banks have recently closed, this is because they have too few customers. Customers are now banking at home (via the internet or telephone).
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Starter What do banks offer to their customers?
What does a bank do? Many banks have recently closed, this is because they have too few customers. Customers are now banking at home (via the internet or telephone). Can bank 24/7, 365 days per year. It is easier to set up accounts and change banks online. Banks therefore run offers such as 0% interest for the first 6 months. • Keeps your money safe • cheque book • Loans and Mortgages • Credit cards/Debit cards • ATMs • Standing Orders/Direct Debits • Insurance Services. Problems… the more well-off are the ones able to take advantages of the higher savings rates and lower borrowing rates offered.
EFTPOS (electronic funds transfer at point of sale) and EFT (electronic funds transfer) Used by stores to transfer money from customers’ credit/debit card directly to the store bank account. Money is taken from one account and deposited in another (electronically). Cash back It is an extension of the service provided by the banking system called EFT (Electronic funds transfer) allowing the movement of money from one bank account to another electronically. • Advantages of on-line banking: • 24/7 • Statements can be viewed on-line • Import data from statements into a spreadsheet • Don’t need to go to the bank • Move money between accounts quickly • Better rates • Make payments to others from home • Less likelihood of identify theft. • Disadvantages: • Could be hacked • Can’t get cash • Older people may not understand how to use the services.
Card Services (credit and debit cards) Credit and debit cards Most popular method of on-line payments. You have to be careful about making payments to individuals or businesses that you don’t know a lot about. If someone has your personal details and credit card details they could be used fraudulently. Chip and PIN reduced card fraud when a card is being used in ordinary stores but over the internet there has been an increase in credit/debit card fraud. Used to make purchases over the phone or internet.
PayPal • On-line banking system - originally for users of e-Bay. • Good if you want to pay quickly and don’t want to give credit card details to firms/individuals they do not know. • They can open an e-Bay account, pay money into it and using a credit card or bank account this money can be passed from Paypal to the person who is selling the goods. • Useful for small businesses.
Nochex Like PayPal but UK based. Secure on-line payment service. Allows you to send payments to other people without giving them your card details. • Create an account • Put money into your account using your credit/debit card. • Buy goods on-line and transfer the money form your Nochex account to the seller. • One off payments without creating an account. • FREE to the person making the payment but the person selling the goods or service is charged a fee.
Splash Plastic Make payments in the same way as any bank card, including shopping on-line. Aimed at anyone who does not have a bank account or bank cards. Available to under 18s who are too young to have a credit card but want to shop on-line. Card can be topped up by a credit / debit card or with cash form stores displaying the Pay Point sign and any post office branch in the UK.
Card crimes and methods of prevention • Lost and stolen card fraud. • Counterfeit card – a clone of your card is made. A piece of equipment is used to read the data on the magnetic strip and then transfer the information to a fake card. Called skimming. http://www.youtube.com/watch?v=N5IXANgr6Co&feature=related • Card not present fraud –This is the largest type of fraud. • Phishing – e-mails asking online bankers to update their details
Card crimes and methods of prevention • Identify theft Criminals using your fradulently obtained personal information to open or access banking services of credit cards. The criminal will usually use your information along with stolen or false documents to open accounts in your name. They could start by telling the bank that you have changed address and they could apply for credit cards or loans. • How to prevent this: • Be suspicious of any e-mail sent to you (you should never give personal information out via e-mail) • Always shred paperwork containing personal information. • Do not write down banking information. • Install a firewall to prevent hackers from gaining access to your personal details held on computer.
Card crimes and methods of prevention Banks impose home chip and PIN machines to fight fraud Banks supply customers with their own home chip and PIN devices to help identify them when they are accessing on-line bank accounts or using cards for on-line purchases. They are independent of a users computers. They prevent scams such as key logging where Trojan software records the keystrokes a user makes such as passwords and security information requires for on-line payments.
Activity: The dangers of identity theft There has been much in the news recently concerning identity theft and how it is likely to affect one in ten people. You have been asked to produce a self-running presentation on identity theft and the dangers it poses. For the presentation you will need to use your own knowledge of the subject with the material you can find from research using the Internet. Identity theft is a major problem for society, so you should be able to find plenty of information about it. To help you, you should consider using the following sources for your information: • On-line newspaper sites (Guardian, Daily telegraph, Daily Mail, etc). • The BBC news site at www.bbc.co.uk • The sites of the major banks (e.g., Lloyds, Barclays, etc.)
Questions • The rise in the use of the Internet has led to a huge increase in the number of people who use ICT for their entertainment or home banking. • Discuss, by referring to 3 relevant examples, the rise in the use of the Internet for home entertainment. (8) • Disucss the advantages and disadvantages of using home banking services. (4) 2. Online banking is very popular with home users of ICT. (4) • Name and describe 3 services offered by on-line banking. (3) • Some people are sceptical about online banking. Describe two worries that people might have with online banking. (2) • Describe one way that banks can address one of the worries you have described in part (b). (1)
Worked example 1 • Many people now choose to bank on-line because of the time savings it offers. They do not have to travel to the bank and then probably queue up. There are other advantages of on-line banking. Discuss the other advantages and possible disadvantages to the bank customer. (6).
Plenary: Past exam question • ICT has had a big impact on the home. • Illustrating your answer with suitable examples, discuss both the benefits and drawbacks of the impact of ICT on ‘home entertainment’. (10)
