Digital Financial Tools

 

Digital financial Tools and Application

The digital financial tools helps you to make online transaction at anytime and if you availed this kind of facility so there is no need to visit any bank, to fill the form, stand in queue and needs to wait for the result.

Some important tools are:-

What is a one-time password (OTP)?

A one-time password (OTP) is an automatically generated numeric or alphanumeric string of characters that authenticates a user for a single transaction or login session. Many companies use Short Message Service (SMS) to provide a temporary passcode via text for a second authentication factor. For two-factor authentication (2FA), the user enters his user ID, traditional password and temporary passcode to access the account or system.

What is QR code?

The QR code (quick-response code) was invented in 1994 under a team led by Japanese engineer Masahiro Hara from the Japanese company Denso Wave. A QR code consists of black squares arranged in a square grid on a white background. A QR code is used to provide easy access to online information through the digital camera on a smartphone or tablet.

Use of QR code:

1) View a menu in a restaurant.

2) Get directions to a location in Google Maps.

3) Read more about a product or service.

4) Download an app on the App Store or Google Play.

5) Authenticate an online account or Verify login details.

6) Access Wi-Fi by storing SSID, password, and encryption type.

7) Online transaction or Send and receive payment information.

UPI [Unified Payment Interface]

Owner and Developed by : NPCI (National Payments Corporation of India)

Introduced in : 11 April 2016

The Unified Payments Interface (UPI) is an instant payment system developed in India, by the National Payments Corporation of India (NPCI) . The interface facilitates inter-bank peer-to-peer (P2P) and person-to-merchant (P2M) transactions. It is used on Mobile devices to instantly transfer funds between two bank accounts. The mobile number of the device is required to be registered with the bank. The UPI ID of the recipient can be used to transfer money. It runs as an open source Application Programming Interface (API) on top of the Immediate Payment Service (IMPS), and is regulated by the Reserve Bank of India (RBI). Indian Banks started making their UPI-enabled apps available on the Google Play Store on August 25, 2016.

AEPS [Aadhaar Enabled Payment System]

India Post Payments Bank launches Aadhaar enabled payment system. Aadhaar-enabled Payment Services (AePS) is a bank-led model which allows online financial transactions at Point-of-Sale (PoS) and Micro ATMs through the business correspondent of any bank using Aadhaar authentication. The model removes the need for OTPs, bank account details, and other financial details. It allows fund transfers using only the bank name, Aadhaar number, and fingerprint captured during Aadhaar enrolment, according to the National Payments Corporation of India (NCPI).
Note : Aadhaar number, fingerprint and name of the bank holding the account are necessary to transact using AePS.

The following are the services AEPS provides:

1) Cash Deposit

2) Balance Enquiry

3) Cash Withdrawal

4) Aadhaar to Aadhaar Funds Transfer

5) A mini-statement

USSD (Unstructured Supplementary Service Data)

USSD (Unstructured Supplementary Service Data) is a Global System for Mobile Communications (GSM) protocol that is used to send text messages. USSD is similar to Short Message Service (SMS). USSD uses codes made up of the characters that are available on a mobile phone. A USSD message, which can be up to 182 characters long, establishes a real-time communication session between the phone and another device -- typically, a network or server. USSD can be used for Wireless Application Protocol (WAP) browsing, mobile money services, prepaid callback service, menu-based information services and location-based content services. Note: To Open Menu Option for Bank service related the ussd code is *99#. For this service is needed the sim is registered to the bank.

The services are:

1) Send Money

2) Request Money

3) Check Balance

4) My Profile

5) Pending Requests

6) Transactions

7) UPI Pin

Card [Credit / Debit]

What is a Debit Card?

A Debit card is issued by a bank against your current account or savings account. The major point to be noted about a debit card is that it allows you to use only the amount of money that’s available in your bank account at the moment. This implies that as you make payment using your debit card, the amount of purchase will directly be debited from your current or savings account.

What is a Credit Card?

A Credit card is a financial tool that allows you to borrow funds from your credit card issuer at the luxury of making purchases as and when required. Additionally, to repay the borrowed amount, you get a grace period of around 45 days without any interest charges on the billed amount. When you buy a credit card, you get a customized credit limit, which indicates the maximum amount that you can spend using your credit card.

Similarities in a Debit Card and Credit Card :-

1) Both of these cards look identical and have a 16-digit card number.

2)A debit card and a credit card have expiration date.

3) In order to make a transaction, using either of these cards, you must enter a PIN (Personal Identification Number) code.

4)Both, debit card and credit card can be used to make online and offline purchases.

5)Both these cards can be used at an ATM in order to withdraw money.

Difference Between Debit Card and Credit Card :

According To	Debit Card	Credit Card
1) Usage	Allow you to purchases using the amount in your current and saving account.	Allow you to make purchases by borrowing funds from the bank.
2) Interest Charges	No interest charges applicable.	Interest charges applicable on late repayment of the billed amount.
3) Source of Money	Money deducted/used from your current/savings account.	Money borrowed from bank/credit card issuing company.
4) Eligibility Criteria	No Specific eligibility criteria to be fulfilled .	You must meet some specific eligibility condition of income, age etc.
5)Charges	Allowed, without any additional charges	Allowed, with additional charges.
6)Additional benefit	No, additional benefit	Cashback, reward point, vouchers etc to be redeemed on future purchases.

Card Image

Card Front Image	Card Back Image

1) Bank logo - Each payment card has a label of its issuing bank; this logo is located in the upper left or right corner of the front of the card.

2) EMV chip - EMV is short for Europay, Mastercard and Visa: the three companies that created the EMV standard. A chip that stores payment card information for payments on electronic payment terminals.

3) Contactless symbol - New payment cards contain a symbol for making contactless payments which means you do need to enter your PIN code; the amount usually does not exceed 30 euros.

4) Payment card number - It varies in length from 16 digits. If card details are embossed it is called an embossed payment card which also can be used at locations with mechanical scanning device (in that case an electronic payment terminal is not required).

5) Expiry date - It indicates a validity period of your card due to security reasons. It usually consists of a month and year as either ‘Valid from’ - ‘Expires end’ or just ‘Expires end’. The card is valid until the last day of the month indicated.

6) Cardholder’s name - A payment card is issued in the name of the cardholder and is not transferable to another person.

7) Association logo - In most cases it is located in the lower right corner of the front of the card. It is Card brand logo example : VISA, Mastercard, Rupay card etc.

8) Magnetic stripe - Payment card information are entered here for magnetic stripe readers.

9) Signature stripe - A cardholder signs here with a black or blue pen; this signature may not agree with the specimen signature at the issuing bank.

10) CVV / CVC -The CVV full form is (Card Verification Value) and the CVC full form is (Card Verification Code) . It is a 3-digit verifiaction code that is located on the back of your card; this code is required for online payments.

What is e-Wallet?

E-wallet stands for electronic wallet. It is a type of electronic card which is used for transactions made online through a computer or a smartphone. The utility of e-wallet is same as a credit or debit card. An e-wallet needs to be linked with the individual's bank account to make payments. The main objective of e-Wallet is to make paperless money transaction easier.

How does it work?

E-wallet has mainly two components, software and information.

Software component stores personal information and provides security and encryption of the data whereas information component is a database of details provided by the user which includes their name, shipping address, payment method, amount to be paid, credit or debit card details, etc.

What is Point of Sale (POS)?

The point of sale (POS) or point of purchase (POP) is the time and place at which a retail transaction is completed. At the point of sale, the merchant calculates the amount owed by the customer, indicates that amount, may prepare an invoice for the customer (which may be a cash register printout), and indicates the options for the customer to make payment.

After receiving payment, the merchant may issue a receipt for the transaction, which is usually printed but can also be dispensed with or sent electronically.

INTERNET BANKING

Internet banking, also known as online banking, e-banking or virtual banking, is an electronic payment system that enables customers of a bank or other financial institution to conduct a range of financial transactions through the financial institution's website.

Different types of online financial transactions are:

1) National Electronic Fund Transfer (NEFT) : National Electronic Funds Transfer (NEFT) is a nation-wide payment system facilitating one-to-one funds transfer. Under this Scheme, individuals, firms and corporates can electronically transfer funds from any bank branch to any individual, firm or corporate having an account with any other bank branch in the country participating in the Scheme.

However, such cash remittances will be restricted to a maximum of Rs.50,000/- per transaction. NEFT, thus, facilitates originators or remitters to initiate funds transfer transactions even without having a bank account. Presently, NEFT operates in hourly batches - there are twelve settlements from 8 am to 7 pm on week days (Monday through Friday) and six settlements from 8 am to 1 pm on Saturdays.

2) Real Time Gross Settlement (RTGS) : RTGS is defined as the continuous (real-time) settlement of funds transfers individually on an order by order basis (without netting). 'Real Time' means the processing of instructions at the time they are received rather than at some later time; 'Gross Settlement' means the settlement of funds transfer instructions occurs individually (on an instruction by instruction basis).

The RTGS system is primarily meant for large value transactions. The minimum amount to be remitted through RTGS is 2 lakh. The RTGS service for customer's transactions is available to banks from 9.00 hours to 16.30 hours on week days and from 9.00 hours to 14:00 hours on Saturdays for settlement at the RBI end. However, the timings that the banks follow may vary depending on the customer timings of the bank branches.

3) Immediate Payment Service (IMPS) : IMPS offers an instant, 24X7, interbank electronic fund transfer service through mobile phones.

Objectives of IMPS:

1)To enable bank customers to use mobile instruments as a channel for accessing their banks accounts and remit funds.

2)Making payment simpler just with the mobile number of the beneficiary.

3) To sub-serve the goal of Reserve Bank of India (RBI) in electronification of retail payments.

4) To facilitate mobile payment systems already introduced in India with the Reserve Bank of India Mobile Payment Guidelines 2008 to be inter-operable across banks and mobile operators in a safe and secured manner.

5) To build the foundation for a full range of mobile based Banking services.

What is Online Bill Payment?

Online bill pay is a digital banking or payment service that lets you pay bills over the web from a bank account—often at no extra cost.

Some example:

1) Electricity Bill

2) Fast Tag Recharge

3) Mobile bill/ recharge

4) Gas Connection payment

5) Dish TV (DTH )

6) Wifi Recharge

7) Metro Recharge.

8)House Tax

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