DIGITAL PAYMENTS A Aaa

A STEP TOWARDS CASHLESS INDIA

ROLL NO. NAME REGISTRATION

NO
97 ANKIT SHARMA NRO0473872
98 ARPIT JAIN NRO0488635 SUBMITTED TO :
99 ASHISH GUPTA NRO0525288
100 AYUSH ARORA NRO0493445 ANITA DEY MAM
101 AYUSH GUPTA
 INDEX
1) Introduction
a)Traditional methods
b)Problems
c)Digital payments intro
2) Digital payments method
a) Internet and mobile banking
b) Imps
c) UPI
d) Mobile Wallets
e) Crypto
f) USSD
3) Digital payments fraud
1)Advantage
2)Disadvantages and frauds
3)Relevant IT Act provision
 

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 INTRODUCTION

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 TRADITIONAL METHODS

 CASH- Money in the form of coins or notes.

A document that orders a bank to pay a

 CHEQUE- specific amount of money from a person's
account to the person in whose name the
cheque has been issued.

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 A plastic card that can be used to
 DEBIT CARD- take money directly from your
bank account when you pay for
something.

 CREDIT CARD- A small plastic card that allows

somebody to get goods or
services without using money.

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 LIMITATION OF TRADITIONAL METHOD

Cheques and cash cannot be exchanged in

real time.
Credit and Debit card information
exchanged over the phone entails security
risks.
Credit and Debit cards do not support
individual to individual payment transaction.
Cash do not support low value transaction.
Less convenient.
Financial risk to the consumer.

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 DIGITAL PAYMENT
 Digital payments are transactions that take place via
digital or online modes.

 The payer and the payee, use electronic mediums to

exchange money.

 Can take place on the internet as well as on physical

premises.

 Money transfers through mobile payment service apps

and QR codes.

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 BENEFITS OF DIGITAL PAYMENT
Digital payments are much faster
 Instant Payment - than the traditional methods of
payments such as cash or cheques.

 Better Electronic payments can help you to

customer provide convenient payment
-
convenience experience to your customers. 

In the case of electronic

  Transparent - payments, you do not have to
worry about the record of your
payment details. 

  Contactless - In the times of the COVID-19

pandemic,
the need for contactless payments has
increased.

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 METHODS OF
DIGITAL PAYMETS

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 NATIONAL ELECTRONIC
FUNDS TRANSFER (NEFT)
 The National Electronic Funds Transfer (NEFT) is

an electronic payment system that facilitates direct

one-to-one payments across the country.

 Using this facility, you can electronically transfer

funds from any bank branch to any individual

having an account with any other bank branch in

the country that is a part of the NEFT scheme.

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 REAL TIME GROSS
SETTLEMENT (RTGS)

 The acronym 'RTGS' stands for Real-Time Gross

Settlement.

 It is the process of continuous (real-time)

settlement of funds, which occurs individually,

on an order by order basis, without netting.

 your request to transfer or settle funds is carried

out immediately, instead of the same happening

in batches (as is the case in NEFT).

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 INTERNET BANKING

 Internet Banking, also known as net-banking or

online banking.

 It is an electronic payment system that enables

the customer of a bank or a financial institution to
make financial or non-financial transactions
online via the internet.

 Internet banking can be accessed by any

individual who has registered for online banking
at the bank, having an active bank account or any
financial institution.

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 MOBILE BANKING

 Mobile banking is the act of making financial

transactions on a mobile device (cell phone,
tablet, etc.).

 This activity can be as simple as a bank

sending fraud or usage activity to a client’s cell
phone or as complex as a client paying bills or
sending money abroad.

 Mobile banking is very convenient in today’s

digital age with many banks offering impressive
apps.

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 IMMEDIATE PAYMENT
SERVICE (IMPS)
 IMPS full form is Immediate Payment Service. It
is an instant electronic fund transfer service that
allows inter and intra-bank transfers.

 In simple word, IMPS helps customers transfer

money instantly from one account to another

 While there is no cap on the minimum transfer

amount, the maximum amount you can transfer
per day via the Immediate Payment Service is
INR 200,000.

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 UNSTRUCTURED SUPPLEMENTARY SERVICE
DATA(USSD)

• It allows the user to make payments through featured phones

that are not connected to any internet.

• USSD Banking or *99# Banking is a mobile based digital

payment mode.

• Users need not have any smart phones or internet

connection to use USSD Banking.

• Users can use this service for many financial and non financial
operations such as checking balance, sending money,
changing mobile PIN etc.

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 Click icon to add picture

AADHAR ENABLED PAYMENT SERVICE(AEPS)

• AEPS is an Aadhar based digital payment mode which

allows bank to bank transactions after linking their
Aadhar with bank accounts.

• Money that user pays will be deducted from users

account and credited to payees' account directly.

• AEPS can be used for all banking transactions such as

balance enquiry, cash withdrawal, cash deposit, Aadhar
to Aadhar fund transfers etc.

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 • A cryptocurrency is a digital or virtual
CRYPTO CURRENCY
currency that is secured by cryptography, which
makes it nearly impossible to counterfeit or
double-spend.

• Many cryptocurrencies are decentralized

networks based on blockchain technology.

• A defining feature of cryptocurrencies is that they are

generally not issued by any central authority,
rendering them theoretically immune to government
interference or manipulation.

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 DIFFERENCE

CHARACTERSITICS CONVENTIONAL MONEY CRYPTO CURRENCY

MEANING Fiat currency is backed by the Government A cryptocurrency is a digitally
and can be in the form of physical money or encrypted, decentralized currency
maybe represented electronically. that is not linked to or regulated by
any government

ISSUED BY Issued by the central bank Operates independently

SUPPLY The supply of fiat currencies is unlimited The supply of cryptocurrencies is

limited.
LEGALITY Legal in all countries. Illegal in some countries

SECURITY Less secured Highly secured

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 F R AU D S
AND
R E L AT E D I T AC T
P ROV I S I O N S

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 Disadvantages of Digital payments
Digital Transactions Sacrifice Privacy- With the rising incidence of online fraud,
the risk of hacking will only grow as more people hop on to the digital platform.
Cashless Transactions Are Exposed to Hacking Risks
Payment Providers Could Charge Fees- Payment gateways and third-party
payment processors charge service fees.
The Temptation To Overspend May Increase- While there is no denying the
convenience of card or mobile wallet transactions, it could open a spending trap for an
unsuspecting population.
Increased Business Costs- E-payment systems come with an increased need to
protect sensitive financial information stored in a business's computer systems from
unauthorized access.
Difficult for tech-unsavvy

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 KEY TYPES OF DIGITAL PAYMENT FRAUDS
• Phishing attacks
o Phishing is a fraud technique where a criminal will send a fraudulent message tricking
the recipient into giving away their private information.
o The three most common types of phishing scams are:
Email phishing
Vishing
Smishing

• SIM Cloning: 
o This scam involves cloning or obtaining a duplicate SIM card, which allows the
fraudster to obtain spoofed identity information and receive SMS transactions.

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• Malware:
o Malware, short for malicious software, is a common method cyber
criminals use to access your devices, service or network. Malware is often
hidden in links or attachments, in emails or SMS, but can also be
downloaded via malicious advertisements, unauthorized software
installations or even infected apps.
•  Identity Theft
o Identity theft is when someone has enough of your personal information to
steal your identity for personal or financial gain.
o With enough information scammers may be able to access your bank
accounts, apply for loans in your name.

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 Data on Frauds reported by Scheduled
FRAUD AND PAYMENTS Commercial banks
73.65
SECURITY

Amount of fraud in crores

60
30 10.5510.33 4.04 4.7710.87 7.01 4.31 2.27
0
 Vulnerability to fraud remains the biggest consumer concern r ds r ds in
g
Ca Ca k
t t an
when it comes to digital transactions (42%), followed by e bi e di t B
/D -C
r r ne
privacy of data (36%), failed transactions (36%) and internet TM et te
t-A r n -t In
e te ne
connectivity (33%). rn /In er
te rd Axis Title t
/In Ca d/In
r d r
 Net banking was perceived to be the most secure method of Ca Ca
Oct-19 Nov-19 Dec-19
payment (30%), followed by UPI wallet transaction in-store
(23%), online transaction through UPI/e-Wallet (22%), online
credit/debit card payment (17%) and swiping card at POS
(16%).

 In terms of awareness levels for various anti-fraud mechanisms

deployed by banks, there’s maximum awareness for one-time
password/OTP (66%), followed by SMS/email notifications
(58%), Personal Identification Number/PIN(52%), two-factor
authentication(49%) and PIN shield(37%).

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 SAFEGUARDS • Check bank statements
AGAINST FRAUD regularly

• Change your password •  Exercise caution when buying

periodically or selling stuff online

• Avoid clicking on suspicious • Lodge a complaint with the

mails bank immediately

• Don't share the bank details or • Enable One Time Password for

OTP with someone on the all online transactions

phone

• Keep your system up to date

• Protect Your Device

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 LEGAL FRAMEWORK OF INTERNET BANKING IN INDIA
• The legal framework for banking in India is provided by a set of
enactments, viz.
• The Banking Regulation Act 1949,
• The Reserve Bank of India Act 1934 and
• The Foreign Exchange Management Act 1999
• The Information Technology Act 2002
• The Consumer Protection Act 1986
• The Indian Contract Act, 1872
• The Negotiable Instruments Act,1881
• The Indian Evidence Act 1872

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THANK YOU
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