Presented by :-

Rajat Singh
MBA (Marketing)
DEPARTMENT OF BUSINESS ADMINISTRATION
UNIVERSITY OF LUKCNOW

Increasing number of times when we

pay with methods that dont use cash
re at a restaurant, and pay by a credit or
debit card;
send a demand draft to our brother;
receive a cheque;
make an online payment via direct bank
debit to purchase railway tickets.

Categories of Payments given by

a Payer :1.Paper-based Payments : Cheques & Demand Drafts
2.Card-based Payments : Debit and Credit Cards
3.Electronic Payments : ECS, NEFT, RTGS

PAPER BASED PAYMENTS

Cheque
Payable by the PAYER who holds an
account with the paying bank.

It is drawn on a specified banker.

It is an order to pay written by a

drawer.
It is a risky payment method.

Demand Draft
Also called D.D.
Payable by the paying bank
itself.
Less risky payment method
No practical risk of bouncing

CARD BASED PAYMENTS

Card is made of plastic, the payment instruction is electronic.
When we swipe our card and enter our PIN or sign on a slip, an
electronic authorized payment instruction is created.
The PIN or signature creates the authorization.

Credit Card

Debit Card

Credit Card
It doesnt debit the account, but records it as a
loan given to card holder, and will charge him
interest on it in case if he doesnt pay y a due
date.
A credit card is both a payment product and a
loan product for a bank.

Debit Card
When we swipe our credit card and enter our PIN
bank would pay on our behalf, after first
debiting card holders account. So, a debit card
is a pure payment product.

ELECTRONIC PAYMENTS
In Electronic Payments,
the instruction to pay is created electronically; there is no
physical payment instrument. The instructions are purely electronic.

The different electronic payment methods are :-

ECS

RTGS
NEFT

ECS (Electronic Clearing service)

It clears and settles mainly bulk, repeated electronic payments.
For example, one can give a onetime authorization to Idea
Cellular, authorizing them to debit his account for the bill
amount every month. Idea will then request its bank to collect
these payments in bulk for all such customers.

NEFT (National Electronic Fund Transfer)

It is useful for one time electronic payments.
Example, one can choose to make a payment every month,
electronically. He has to instruct his bank by filling in either a
paper or online (via Net banking) authorization- to transfer the
funds to Idea Cellulars account. For this, he needs to have Idea
Cellulars bank, branch and account number.

RTGS (Real Time Gross Settlement)

It is used when bill crosses Rs. 2 lakhs. If it does, and one is in
a hurry to transfer the funds, he can again give an
authorization to his bank as in the case of NEFT. Idea will get
the funds immediately.

THANK YOU