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Digital payment system

Here, we discuss about digital payment system in detail as follows-

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Digital payment system
  • Digital payment sytem used by customer for payment to the merchant in E-commerce.
  • For this customer must have his software with him, which has to be connected with the company providing service of Digital payment. Similarly merchant must have to be registered to the company which gives electronic payment. For this there is not any bond between customer can buy and pay the money easily by using his Internet.
  • In digital payment system, payment is done by two methods that is - (a) Electronic cheque        (b) Electronic cash.
(a) Electronic cheque (Net Banking):
  • E-mail is very popular mail nowadays. Its fast and cheap. Same way E-cheque method is developed so that people can work in much the similar environment as of a conventional paper cheque. This process takes very less amount of time. The entire payment process takes about two days.
  • For this an account holder has to fill up the document. Which contains name of the payer, address, account number, the name of financial institute, the name of payer, amount, date, etc. Similar to paper cheques the E-cheque bears the digital equivalent of signature which is in the form of number so that financial institute authenticates the proper account holder. It is also necessary the support of E-signature before the amount paid.
(b) Electronic cash (or cyber cash):
  • In Electronic cash customer, merchant and financial institute uses the facility of Internet. Here, register is not done by any financial institute. so you can exchange money from any place.
  • Electronic cash started in 1994 which facilitates the exchange through Internet for merchant, customer and financial institutes, which is a method of payment accept by all.
  • Electronic cash is a safe, easy and inexpensive method through which customer and merchant exchange money easily.
  • Software used to store the equivalent cash onto a storage media for E-cash.
  • In order to receive the money we (merchant) have to depend on our (his) bank. Bank pays the cash money through its ATM machine or another method to the account.
  • Due to the Internet banking this method becomes very popular. Customer or merchant can see the details of their account in a second, so that the exchange grows very fast and safely.
  • E-cash system is one-way token system that allows the money to be used only once. The merchant who has received E-cash has to bring it to bank, to get it cashed. There is no provision for merchant to use it for future transaction. Digicash, Netcash, Cybercoin are some examples of E-cash.
(c) Electronic wallet:
  • Whenever purchase is made using credit card, each time customer needs to provide all the details like credit card number and billing and shipping information in the forms provided by the website.
  • To avoid providing same information every time, the electronic wallet is used.
  • The electronic wallet is just like physical wallet and keeps customers credit card details, electronic cash, identification and address details.
  • Whenever purchase is made, at the checkout counter, the wallet is used to provide all the details.
  • The details are automatically read and placed in appropriate fields in forms. This makes purchase very quick and easy.
  • The electronic wallet is either stored in client's computer or in common server accessible to customer.
  • If wallet is stored in client's computer, the purchase is only possible from the client's computer. On the other hand, if the wallet stored in server, purchase can be made from anywhere as wallet is accessible by connecting to the server.

Digital payment system
Electronic cheque
Electronic cash
Electronic wallet
cyber cash
Digital payment system
Tech writer at NewsandStory