ITPEC IP October 2018 Question 90

Credit accumulated with purchases and services offered according to it — a point card rewards repeat buying.

Each purchase earns points in proportion to the amount spent. The customer later exchanges them for discounts, goods or other privileges, which gives a reason to keep buying at the same retailer. The retailer also gets each member's purchase history, which it uses to understand and keep its loyal customers.

Answer (c)

Why not others:

• •(a) — shopping within a credit limit and paying later is a credit card
• •(b) — paying the amount from a bank account with an ATM card is a debit card
• •(d) — paying in advance and having each purchase deducted from the card is a prepaid card, or electronic money

Key rule: Credit, debit and prepaid cards are ways to pay: later, now or in advance; a point card is not a payment method but a loyalty program that records rewards for purchases.

Business Strategy Management · AI-written, may contain errors