Understanding Financial Institutions Quiz

Which of the following is the central bank of the United Kingdom responsible for issuing currency and maintaining monetary stability?

• National Savings and Investments

• Bank of England

• Building Societies

• Credit Unions

What is one advantage of using a building society over a traditional bank?

• Higher interest rates on savings

• More branches available

• Offers payday loans

• Provides insurance services

Which type of financial institution is known for offering short-term, high-interest loans to individuals?

• Banks

• Credit Unions

• Payday Loans

• Pension Companies

What is a primary disadvantage of using a pawnbroker?

• High interest rates

• Limited loan amounts

• Requires collateral

• Long approval process

Which financial institution is specifically designed to help individuals save for retirement?

• Insurance Companies

• Pension Companies

• Building Societies

• Pawnbrokers

What is a key feature of credit unions that differentiates them from banks?

• They are for-profit organisations

• They are owned by their members

• They offer higher interest rates on loans

• They are government-owned

Which of the following is a government-backed savings institution in the UK?

• National Savings and Investments

• Bank of England

• Building Societies

• Credit Unions

What is one disadvantage of using payday loans?

• Low interest rates

• Long repayment terms

• High fees and interest rates

• Requires a credit check

Which type of financial institution typically offers life, health, and property coverage?

• Banks

• Insurance Companies

• Credit Unions

• Building Societies

What is a common advantage of using banks over other financial institutions?

• Higher interest rates on savings

• More diverse financial products

• Member ownership

• Government backing