Build up your financial fitness by discovering new ways to make banking work for you. To learn more about your banking needs, check out the following questions and answers specific to peer-to-peer (P2P) payment services, credit interests, and bank account levies. Our questions come from people like you who want to learn more about best banking practices with answers written by our expert banker, Alex. If you have a question about your banking needs, please email Alex at email@example.com. Relevant questions will be posted on our website, and all questions will be answered by Alex in a timely manner.
Question: How does a peer-to-peer payment service work?
Asked by: Kassie from Bellevue, Washington.
Answer: A peer-to-peer (P2P) payment service allows one individual to send funds electronically to another individual through a peer-to-peer payment app. The most popular apps are Venmo, Zelle, Google Pay, PayPal, and Cash App. To begin, both individuals must enroll in the same app and add their bank account, debit card, and/or credit card information. Then, they will follow the app’s instructions to electronically send and receive money. Depending on the app, there could be a transaction fee of up to 3% . Peer-to-peer payment services are generally safe, with the larger apps having sophisticated encryption that protect the user’s financial information. Unfortunately, like any other method of payment, there has been an increase in scams and hacks.
Question: When do I have to pay interest on credit card purchases?
Asked by: Tucker from Lawton, Oklahoma.
Answer: A credit card allows the cardholder to access a line of credit to pay for goods and services. The cardholder is responsible for paying back the borrowed money plus interest. Monthly statements are sent to the customer, either online or through the mail. The statement will include the balance from the previous cycle, the minimum payment due, the payment due date, and a summary of all the transactions that are made during the billing cycle. Most credit card companies will provide a grace period of at least 21 days. The grace period is the time between when the billing cycle ends and the payment is due. Interest on purchases isn’t charged if the statement balance is paid in full during the grace period. Another way to avoid paying interest is to open a credit card with an introductory 0% annual percentage rate. These cards will not charge an interest rate on purchases for a disclosed period of time, typically between 6 months to almost two years.
Question: There is a levy placed on my checking account. What does that mean?
Asked by: Earl from Biloxi, Mississippi.
Answer: A bank account levy occurs when a creditor legally instructs a financial institution to withdraw funds from an account without the account holder’s permission to satisfy an outstanding debt. The debt can be from an unsecured loan, medical bill, student loan, or unpaid taxes. Most creditors are required to provide a court judgement to the financial institution before a levy can be placed. Some government creditors, like the IRS or Department of Education, can bypass that. Once the request is received, the financial institution will freeze the account and send what is owed to the creditor. If there are not enough funds in the account, the levy can either be repeated or remain until the total amount owed is paid.
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Written by: Alex Sanchez, Branch Manager
Important: For your specific questions about banking, contact your banking expert, Alex, at: firstname.lastname@example.org
Alex has been in banking for almost 20 years. He has worked for such notable banks as Bank of America, US Bank, and Chase. Alex has his bachelor’s degree in Business Economic from the University of California Riverside.
How to Protect Peer-to-Peer Payments: CLICK HERE
Source: Consumer Reports
Understanding Credit Card Interest: CLICK HERE
How to Handle a Court-Ordered Levy on Your Bank Account: CLICK HERE
Source: The Balance
Bank Support: CLICK HERE
Source: Smart Strategies for Successful Living