Professional Documents
Culture Documents
SYSTEMS
ELECTRONIC MONEY
Electronic money is
broadly defined as an
electronic store of
monetary value on a
technical device that may
be widely used for making
payments to undertakings
other than the issuer
without necessarily
involving bank accounts in
the transactions, but
acting as a prepaid bearer
instrument.
Evolution.
A closer analysis revealed that 'at par' items such as dividend and interest
warrants issued by various corporate were contributing significantly to the
volumes in clearing.
Evolution.
It was decided that a system needed to be put in place
that would
(i) decrease the volumes of paper instruments in MICR
clearing and
(ii) improve customer service by ensuring prompt and
secure interest/dividend payments to the beneficiaries.
Seller
Payments
Goods &
Services
Buyer
Types Of
EPS
E- Cash
A system that allows a person to pay for goods
or services by transmitting a number from one
computer to another.
Like the serial numbers on real currency notes,
the E-cash numbers are unique.
This is issued by a bank and represents a
specified sum of real money.
It is anonymous and reusable.
E-Cash Security
Complex cryptographic algorithms prevent
double spending
Anonymity is preserved unless double spending is
attempted
E-Cash Processing
1.
2.
Bank
3.
4.
5.
6.
Smart Cards
Smart Cards
Ticketless travel
Seoul bus system: 4M cards, 1B transactions since 1996
Planned the SF Bay Area system
Authentication, ID
Medical records
E cash
Store loyalty programs
Personal profiles
Government
Licenses
Mall parking
These characteristics make smart cards a viable medium for a digital currency
payment system. In making a payment through stored-value cards, the
following points can be noted: There are no backend settlements involved.
If a card is lost, the same result is achieved when actual cash is lost
its gone.
Credit Cards
Customer Pays
by Credit Card
Merchant Processes
Credit Card Using
Software Provided
Issuing Bank
Approves/Declines Sends
Transaction principal Bank
The Bank
that Issue
Credit Card
To your
Customer
ENTIRE
PROCES
S TAKES
5-15
SECOND
Electronically
submitted to
Principal Bank
Principal Bank
Sends Request to
Issuing Bank
DEBIT CARDS
Debit Cards
Adebit card(also known as abank
cardorcheck card) is a plastic card that
provides an alternative payment method
tocashwhen making purchases.
Functionally, it can be called an electronic check,
as the funds are withdrawn directly from either
thebank account, or from the remaining balance
on the card.
Debit cards may also allow for instant withdrawal
of cash, acting as theATM cardfor withdrawing
cash and as acheck guarantee card.
Credit card
Used for the majority of Internet
purchases
Has a preset spending limit based
on the users credit history.
Currently most convenient method
Most expensive e-payment
mechanism
Advantage
Each month user can pay part or all
of the amount owed
Disadvantages
Does not work for small amount
(too expensive)
Does not work for large amount
(too expensive)
Debit card
Used for the majority of
general purchases
Has no spending limit
Currently most convenient
method
Most non-expensive epayment mechanism
Special feature helps to
withdraw from ATM as hard
cash
Advantages
Operates like cash or a
personal check
Disadvantages
Money is immediately
deducted from users
account balance
E-Wallet
E-WALLET
2. Download
3. Fill
4. When
you are ready to buy, click on the wallet button, the buying
process is fully executed.
The EFT process cycle is spread over 3 days. Funds are made
available to the beneficiary on a T+1 basis
have your paycheck deposited directly into your bank or credit union
checking account
Automated teller
machines(ATMs)
Automated teller
machines(ATMs)
Security
Transactional
Scalabilty
Interoperability
Economic
Issues
Transactional Issues
It refers to the actual exchange of currency
with
the
goods
or
services
being
transferred. Every transaction should exhibit
the following characteristics:
Atomicity
Transfer Of Funds
Complete Transfer
Consistency
Durability
Security Issues
Fraud Protection
No Double Spending
No Counterfeiting
No Overspending
Non-Refutability
Privacy Control
Non- Traceability
Hardware Tamper Resistance
Interoperability
It refers to its ability to operate in multiple
online in multiple online as well offline
Payment environment. The various issues
involved under interoperability are:
Divisibility
Bi- Directional
Re-Spendibility
Acceptability
Multi- Currency Support
Portability
Scalability
It refers to the level of operations possible
within a certain payment system. The ability of
a system to handle load under peak hours. The
various issues involved under Scalability are:
Offline operations
Micro Payments
Low Costs
Efficiency
Macro Payments
Economy Issues
In order to become an accepted Economical
instrument, a digital payment system needs to
provide a trusted, reliable and economically
feasible service to a sufficiently large user
community. The system should have:
Large User Base
Low Risk
Reliability
Conservation
Ease Of Integration
Features
Online
Credit Card
Payment
Electronic
Cash
Electronic
Cheque
Smart Cards
Actual
Payment
Time
Paid later
Prepaid
Paid later
Prepaid
Transaction
information
transfer
Free transfer.
No need to
leave the
name of
parties
involved
Electronic
checks or
payment
indication
must be
endorsed
Online and
Online
offline
transactions
transactions
Online
transactions
Offline
transfers are
allowed
Offline
transfers are
allowed
Bank
Credit card
account
account
involvement makes the
payment
No
involvement
The bank
account
makes the
payment
Users
Anyone
Anyone with
a bank
account
Anyone with a
bank or credit
card account
Any
legitimate
credit card
users
Features
Online
Credit Card
Payment
Electronic
Cash
Electronic
Cheque
Smart Cards
Mobility
Yes
No
No
Yes
Limit on
transfer
Depends on
Depends on
the limit of
how much is
the credit card prepaid
No limit
Depends on how
much money is
saved
Party to
which
payment is
made out
Distributing
Bank
Store
Store
Store
Consumer
s
transaction
risk
Most of the
risk is borne
by the
distributing
bank,
consumers
only have to
bear part of
the risk
Consumer is
at risk of the
electronic
cash getting
stolen, lost,
or misused
Consumer
bears most of
the risk, but
the consumer
can stop
check
payments at
any time
Consumer is at
risk of the smart
card getting
stolen, lost or
misused