CH-4 BUSINESS SERVICES

MODES OF DIGITAL PAYMENT

1. NATIONAL ELECTRONIC FUND TRANSFER(NEFT)

• It is an electronic funds transfer system maintained by Reserve Bank of India.
• It enables bank customers in India to transfer funds between any two NEFT-
enabled bank accounts on a one-to-one basis.
• There is no value limit on the transactions of NEFT. For using NEFT, an eleven
digit Indian Financial System code is used.
2. REAL TIME GROSS SETTLEMENT(RTGS)
• RTGS system is maintained and operated by the RBI and provides a means of
efficient and faster funds transfer among banks.
• The RTGS system is primarily meant for large value transactions. The
minimum amount to be remitted through RTGS is RS. 2,00,000 lakh. There is
no upper ceiling for RTGS transactions.
• Real time means the processing of instructions at the time they are received
rather than at some later time.
• Gross settlement means the transactions is settled on one to one basis
without netting with any other transaction.
3. Cash Credit
• It refers to a loan given to a borrower against his current assets like shares,
stocks, bonds etc.
• A credit limit is sanctioned and the amount is credited in his account. The
borrower may withdraw any amount within his credit limit.
• This facility is helpful in meeting day to day working capital needs.
• Interest is charged on the amount actually withdrawn.
4. BHARAT INTERFACE FOR MONEY (BHIM)
• It allows users to make payment using the UPI application.
• The BHIM app can be used by anyone who has a mobile number, debit card
and a valid bank account. Money can be sent to different bank accounts,
virtual addresses or to an Aadhaar number.
5. AADHAR ENABLE PAYMENT SYSTEM (AEPS)
• It can be used for all banking transactions such as balance enquiry, cash
withdrawal, cash deposit, payment transactions.
• All transactions are carried out through a banking correspondent based on
Aadhaar verification.
• There is no need to physically visit a branch, provide a debit or credit cards or
even make a signature on a document.
6. UNIFIED PAYMENT INTERFACE (UPI)
• Under this system, any customer holding any bank account can send and
receive money through a UPI based app.
• The service allows a user to link more than one bank account on a UPI app on
their smart phone to seamlessly initiate fund transfers and make collect
request on 24/7 basis and on all 365 days.
7. UNSTRUCTURED SUPPLEMENTARY SERVICE DATA (USSD)
• It is another type of digital payment without mobile facility.
• Its main aim is to create an environment of inclusion among the underserved
sections of society and to integrate them into mainstream banking
• This service can be used to initiate fund transfers, get a look an bank
statements and make balance queries.
8. MICRO ATM:
• It is a mini version of an ATM. It is like modified point of sales terminals,
which can connect to banking network via GPRS to perform banking
transactions.
• This machine contains card swipe facility and fingerprint scanner. These
machines are carried by bank representative at remote/mobile locations.
• They support the transactions related to deposit, withdrawal, fund transfer
and balance enquiry.
9. MOBILE WALLET
• It is a type of virtual wallet service that is used to keep currency in digital
form.
• It stores bank account information or debit/credit card information in an
encoded format to allow secure payment.
• One can also add money to a mobile wallet in digital form and use the same
to make payments and purchase goods and services. Cash is kept in an
electronic form and smart phone or computer is used to make a financial
transaction.
10. POINT OF SALE (POS)
• There are different types of PoS terminals such as Physical PoS, Mobile PoS
and Virual PoS.
• Physical PoS terminals are the ones that are kept at shops and stores.
• On the other hand, mobile PoS terminals work through a tablet or
smartphone. This is advantageous for small time business owners as they do
not have to invest in expensive electronic registers.
• After the customer makes the payment, the seller may issue a receipt for the
transaction, which is usually printed but is increasingly being dispensed with
or sent electronically.
11. MOBILE BANKING
• It is a system that allows customers to perform banking transactions through
a mobile device.
• It is a quite popular method of banking that fits in well with busy
technologically oriented lifestyle.
• Through mobile banking user can accomplish tasks such as checking account
balances, transferring funds between accounts, bill payment etc.
• To avail mobile banking service, the user needs to have an account with the
bank, a valid mobile connection and handset supporting the services.
12. QUICK RESPONSE CODE (QR CODE)
• It is a two dimensional code, which has a pattern of black squares that are
arranged on a square grid with a white background.
• It secretly contains the details of the Bank account of the merchant. By
scanning the pattern of QR Code in the smartphone, the user can transfer the
desired amount into the receivers bank account.
• QR Code has enabled merchants to accept digital payments without investing
in any hardware such as the point of sale terminal.