Exercise 11 Read the text about credit cards and decide if the following statements are true or false

1. Any customer can have a credit card.

2. The user can spend only a certain amount.

3. The user must spend €250 per month.

4. The bank pays the bills then the user pays the bank.

5. A credit card has advantages and disadvantages.

6. You always pay interest if you use a credit card.

Many banks now offer their customers credit cards. Any customer can apply for a credit card. If the bank thinks the customer is a good risk, it will issue him with a card and inform him of his personal credit limit.

For example, the bank might allow a customer a limit of €250 per month. This means that every month the customer can use his card to pay for €250 worth of goods and services or to borrow €250 in cash, travellers’ cheques or foreign currency. It does not matter if the customer’s bank account is empty, when he spends or borrows the €250.

At the end of the month the bank will send the customer a statement. Provided the customer clears his account every month the facility will cost him nothing. He will have a month’s credit free.

However, if the customer fails to clear his account every month he will be charged some interest per month on the outstanding balance. This alternative form of money can become very expensive, therefore.

Exercise 12 Read the text about travellers’ cheques and decide if the following statements are true or false.

1. Travellers’ cheques cannot be lost or stolen.

2. They are easy to cash.

3. You must always order travellers’ cheques.

4. You pay twice for travellers’ cheques.

5. You must sign each cheque twice.

6. You must keep a record of your cheques.

When travelling abroad it is always wise to carry your money in travellers’ cheques because cheques are protected against loss or theft. If your cheques are lost or stolen the issuing authority will refund your money.

Not only are they safe, they are also convenient. They are available in different denominations and different currencies and they can be cashed at most banks throughout the world. Most shops, hotels and restaurants also accept them.

To obtain travellers’ cheques you usually go to your bank. They can be paid for in cash or debited to your account. Large amounts, however, must be ordered in advance.

For the safety and convenience of travellers’ cheques you are charged two commissions. An insurance commission when you buy them and an encashment commission when you cash them.

They are very easy to use. When you collect them you sign each cheque once. The cashier may enter the amount in your passport. When you cash them you sign each cheque again. The casher will usually ask to see your passport again too.

It is advisable to make a note of the serial numbers and denominations of your cheques in case they are lost or stolen. Keep this separate from the cheques.