what is electronic payment?
We also know e-payment as electronic payment. E-payment or electronic e-payment is any digital financial payment transaction that involves money transfer between two or more parties. Electronic payments are Internet-based processes. Which helps the customer or user to make an online payment for their purchase etc. To transfer money over the Internet. Method of electronic payment. Electronic Cash, Smart Card, and Debit / Credit, Google Pay, Phone Pay.
What is electronic payment system?
The electronic payment system is defined as a system.
E-payment or electronic payment is any digital financial payment transaction involving money transfer between two or more parties.
The implementation of electronic payment systems is still in its infancy and is still evolving.
Electronic payment is significantly cheaper than the traditional way of mailing paper invoices and then processing the received payments. Electronic payment systems are Internet-based processes.
An electronic payment system is a system that helps a customer or user to pay online for their purchases etc. To transfer money over the Internet. Traditional payment method. Such as check, credit or cash and electronic payment methods. Such as electronic cash, software wallet, Google Pay, phone pay, smart card and debit / credit.
Benefits of electronic payment systems
Customer support: Electronic payment systems enable fast order processing and delivery, which cater for high efficiency in both (B2B) and (B2C).
Convenience: Electronic payment system is very convenient for the customer. In most cases, all you need to do is enter your account information.
Low cost: Electronic payments are lower for businesses. The more payments they can process electronically, the less expenses on paper and postage.
Electronic Payment Disadvantages
Security: The flexibility that e-payments enjoy can also pose security threats.
Payment system collision: Because online payment systems are new and global in their perspective, problems can occur when it comes to applying them to all e-commerce businesses.
What is the need for an electronic payment system?
The requirements of the electronic payment system are:
Authentication: A method of verifying the identity of buyers before making a payment.
Integrity: Ensuring that all information is not altered or destroyed during Transmission.
Assurance: The customer can be sure on his part that the trader is competent and worthy of his trust.
Privacy: There may be situations where both the customer and the merchant would like to ensure the confidentiality of the sale.
Why is online payment important?
Online invoice payments help companies save time, accelerate and save maximum effort for customers. It also helps to reduce excessive costs involved in physical transactions. It also helps to reduce the significant amount of paper that will be printed and used to send invoice.
Is it safe to make online payments?
Online bill payment is safe when you choose the right bill payment service. Usually, an online bill payment service which is supported by a bank or a company that provides online banking services is safe and reliable.
Type of electronic payment system – What is the type of electronic payment system?
The five types of electronic payment technologies are described below.
E-Cash / Digital Cash
Electronic check (e-check)
E-Cash / Digital Cash: A digital cash / e-cash is a system of purchasing relatively small amounts of cash credits, storing credits in your computer and then spending them while doing electronic shopping on the Internet. Digital cash works very much like real cash, except that it is not on paper. Money in your bank account is converted into a digital code.
Examples: - e-coins, e-wallet, money transfer
Benefits of E-Cash
1- More efficient, ultimately meaning lower prices.
2- Reduced transaction costs
3- Anyone can use it unlike a credit card, and does not have special authority
4- Money transfer from home
5- Online Shopping
Loss of e-cash
1- Tax mark, like regular cash.
2- Money laundering.
3- susceptible to forgery.
4- Service fees
Electronic Check (E-Check): Electronic check is another form of credit payment that allows customers to use digital online checks to make payments directly to web merchants. An electronic check is a form of payment made via the Internet that is designed to perform the same functions as a traditional paper check.
Benefits of E-Check…
1- fast processing
2- Reduction in duties and labor
3-Customer Payment Options
Loss of E-Check.
1-Possibility of fraud
2- errors and shortages
Credit card: A credit card system is a type of retail transaction and credit card system, named after a small plastic card issued to users of the system. A credit card is different from a debit card, in which the credit card issues the consumer’s money instead of the money withdrawn from an account. A credit card is an instrument that helps you to do instant credit based transactions.
Benefits of credit card
1-Building Credit Card History
2- No interest on timely payment
3- Consumer Protection
Credit card loss
1- Credit Card Fraud
2- Possibility of impulse purchase
3- Annual fee
4- Fees for late payment
Debit Card: A debit card is a plastic payment card that can be used instead of cash while shopping. Debit cards eliminate the need to carry cash or physical checks to make purchases directly from your savings.
There are two types of debit cards
Online Debit: Online debit cards use the same built-in technology ATMs (bank machines) that spread cash.
Offline Debit: –Offline carries the logotype of the debit card, and can be used in almost the same way for major credit cards
Benefits of Debit Card…
1- No reliability issues
2- No debit ranking
3- Avoid writing checks
Debit Card Disadvantages….
1- Overlimit fees
3- Interest by banks
4- Less protection from credit card. …
Smart Cards: Smart cards, also called stored value cards, use electronic-strip technology or integrated circuit (IC) chips to store customer-specific information, including electronic money. The IC can be a microprocessor with chip memory or just simple memory circuits. In the layman’s terms, a smart card is a card with which we can exchange data, store it and manipulate data.
Types of smart cards.
Relationship-based smart cards: Relationship-based smart cards are cards that store card holders, information. Name, address, personal details, date of birth, shopping details.
Electronic purse: An electronic purse is a store of value on a card that can be used to pay for travel or other small-scale transactions in the same way as cash.
How do E-Payments Work?
Add money to your e-payment account using an e-payment card. Money gets deducted from your balance when you shop online – or if you are selling things, it gets added to your balance, or. Link your e-money account to your payment card.
E-BANKING: –E-Banking, also known as Internet Banking, E-Banking means anyone who has a personal computer and a browser connected to their bank’s websites to perform any virtual banking work. Can.
The term electronic banking or e-banking covers both computer and telephone banking.
Online banking, also known as internet banking or web banking, E-banking is an electronic payment system. Electronic banking has many names like e-banking, virtual banking, online banking or internet banking. It is simply the use of electronic and telecommunications networks to deliver various banking products and services.
Benefits of e-banking….
To be everywhere
Online purchase and sale
Loss of e-banking
Account setup may take time
Limits on deposits.
Security and identity concerns.
Why e-banking is popular?
This facilitates customers as they do not need to visit the bank’s premises. There is a very little occurrence of errors. The customer can receive funds from ATM machines at any time. Credit cards and debit cards enable customers to get discounts from retail outlets.
ALSO READ: What is Ecommerce – Types of Ecommerce -10 Benefits
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