What is online payment mechanism
When we buy or purchase anything electrically or through online mode, we also pay the amount through internet i.e. online methods. Various ways or methods of giving payment online is called the mechanism of payment through online.
In today’s
modern time, there are many ways for doing payment online. Various methods of
online payments are: Electronic methods of payment
Debit Card: ATM card, also called, is used to access funds from a savings account. A debit card is similar in appearance to a credit card but serves as a cash or personal check. With this we use only the amount deposited in our bank. You use a debit card, you are withdrawing money from your bank account and you can only use up to the amount deposited in that account. All debit cards are used in retail stores, gas stations and hotels.
Advantages
- Debit cards can be obtained more easily than credit cards.
- You do not have to carry much cash or your check when you are out of the house and you can get it from ATM when you do not have currency.
- Debit cards are preferred by merchants over cheques.
Credit Card: It is the first way of making payment through
online. When you use a card to purchase goods, you are borrowing from the card
issuing company. You put your signature on the back of the card and when you
make a purchase you sign the purchase receipt. Then the two signatures are
compared so that they can be seen to match. When you purchase items by e-mail,
phone or internet, you provide the card's expiry date and security code number.
Each card is issued with the consent of the user. Therefore the cardholder should
know the terms of the card. The credit card issuing agency has to pay the
amount at the end of each month after each purchase and each month you receive
a copy of your account statement issued by the institution. It contains details
of the amount paid by the institution and the interest or other expenses
incurred on it.
Advantages
- With credit card you get access to more money
when you go out.
- A credit card is an important tool for paying off
unforeseen expenses
- Credit cards can be used securely to get tickets
for any airline, car rental and hotel room. Check card or if you use a credit
card to make purchases, you have a record of expenses incurred
Mobile Banking: With Mobile Banking, users can view their bank account on
their mobile screen. Daily transactions can be done by pressing a few numbers
on the mobile. Mobile banking provides a variety of services such as savings
account or current account information, check payment withholding or bill
payment.
Telephone Banking: Telephone banking is another important service provided by
e-banking. Telebanking is one such service in which banks can receive telephone
calls during their working hours. This allows a user to transact from the
comfort of their home. Under this service the user calls his bank on telephone
and then the bank asks the user to press a special button to get a particular
service. This system works with microprocessor technology. It does not require
any special software. It recognizes Tone Signal and Pulse. Access to a bank
computer is possible by telephone. Through the telebanking system the user can
get information about their account balance, transfer between accounts, or bill
payment etc.
Advantages
- The caller can get information about his account and credit
card account.
- Electronic bank transfer allows the user to perform many
transactions in a short period of time.
- It provides security to the user's accounts so that no
non-person can get any information about the user.
Electronic Fund Transfer: With the help of EFT s nation currency can be exchanged
electronically from one user's account to another user's. This is done through
electronic data transfer and involves a small exchange of data between the two
users. With the old system of money transfer, time was running out. It took ten
to fifteen days to transfer a check or currency. For one, it takes more time
and more paperwork. Under this facility, one user gives the account number of
another user. For currency transfer the user then contacts his local bank which
initiates the transaction process and the local bank transfers the mass
currency of internet supported to another user's account.
Advantages OR Benefits
- Transfer of currency from one bank account to another
- immediate payment of currency in the bank account
- Provides a lot of convenience to the consumer.
- Reduces the likelihood of errors and scams.
- EFT Facilitate monthly repayment of loans
Electronic Cheque: In traditional check system, transfer of currency takes a
long time. With the advent of e-banking, paper Cheque are no longer required.
E- Cheque is an important feature. E-
Cheque provides greater security and reduces costs. Payment
is made online in e- Cheque system. This takes a few
minutes. Separate accounts are used for paper and e- Cheque. For security of transactions, the bank combines e-
Cheque information in its database.
Advantages
- It reduces costs.
- It enhances security.
- Provides online payment facility.
- Different accounts are used for paper and e-check.
- The bank combines e-cheque information in its database to
protect the transaction.
E-Wallet: E-Wallet is a prepaid account that
allows the customer to store multiple credit cards, debit card and bank account
numbers in a secure environment. This eliminates the need to key in account
information every time while making payments. Once the customer has registered
and created E-Wallet profile, he/she can make payments faster.
Amazon
Pay: Another convenient, secure and quick way to pay for
online purchases is through Amazon Pay. Use your information which is already
stored in your Amazon account credentials to log in and pay at leading merchant
websites and apps. Your payment information is safely stored with Amazon and
accessible on thousands of websites and apps where you love to shop.
