Brits struggle with banking basics

Published on 1 January 1970 by Raffick Marday

The majority of Brits know very little about what common payment terms mean and many lack confidence in how to make common transactions, according to new research. Figures show that older generations have the strongest knowledge when it comes to payment terms and uses.

The latest campaign called ‘Pay YOUR Way’ reveals Britain's payments knowledge gaps and suggests that Brits aren't as payment savvy as they should be.

According to the figures, less than a quarter (24%) of people scored full points to correctly identify all the payments by the descriptions given, including debit cards, Direct Debits, standing orders and Faster Payments.

Furthermore, when asked which payment method is described by ‘a type of electronic payment which means the money will arrive on the same day', only a third (34%) of respondents correctly identified the description as a Faster Payment - despite the fact that 83% of online banking and phone banking transfers are now processed in this way.

Over a quarter (28%) of people were not able to recognise a standing order from its description as ‘an instruction to your bank or building society to make a set payment, usually on a regular basis, to another UK bank or building society'.

Older and wiser

Despite the general level of ignorance on show across all age groups, older generations ranked higher in their banking and payment vocabulary knowledge.

A majority of 95% of over 55s knew what a debit card transaction was, compared to 87% of those under 35. Also, 86% knew what a Direct Debit is - compared to 75% of the younger group - and 77% correctly identified a standing order, in contrast to 65% of the 18-34s.

An accurate knowledge and understanding of what the various banking and payment terms mean -such as bank account types, transfer methods, credit cardsand pre-paid cards - can help British customers to organise their finances and banking services.

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