Digital payments have become an integral part of our life. Digitization has been revolutionary to our lifestyle by introducing convenience at our fingertips. Easily accessible apps & services have helped us save time and also streamlined many services on our mobile phones.
Today, with a click of a button, we can transfer funds and receive payments. There has been a considerable rise in the number of newly emerging digital payment platforms.
A survey reveals that India has witnessed nearly 80% growth in digital transactions in a span of only 250 days!
So now, let's decipher all the digital payment methods that make your life easier.
Unified Payment Interface (UPI):
Unified Payment Interface, commonly known by its acronym UPI, is a system that involves multiple bank accounts under the same hood.
This means that anyone using a UPI app can link his or her multiple accounts and can carry digital banking services with ease. UPI also eases out ‘peer to peer' transferring of funds.
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Mobile Wallets
A mobile wallet is an easy way to carry cash digitally, and it is the most widely used banking service
Digital wallets are easy to use and reduce the need for cash or plastic money.
Digital wallets are linked to a credit card or a debit card. One can transact just by using a PIN or OTP. In order to use a digital wallet, one has to link the bank account.
Digital Banking
Digital or Internet banking is one of the most used digital payment methods.
The entire process of internet banking revolves around accessing funds and making payments through the associated bank’s website.
There are a few branches and sub-types of internet banking as well.
National Electronic Fund Transfer (NEFT) - NEFT is a nationwide digital payment method facilitating one-to-one funds transfer. Through NEFT, one can electronically transfer funds, provided both parties have bank accounts.
Immediate Payment Service (IMPS) - IMPS is an instant inter-bank fund transfer method and is available 24x7 throughout the year. IMPS is easily accessible via Mobile Banking, SMS, Net Banking or ATMs.
Real-Time Gross Settlement (RTGS) is a funds transfer process that is real time & is done on a gross basis. This method is generally used for large-value interbank funds, and the money is transferred within 30 minutes.
Electronic Clearing System (ECS) is an alternative method for effective payment transactions. It is largely used for bulk money transfers and also to pay bills like telephone, electricity, water and monthly loan instalments.
Also Read: 6 Digital Banking Myths that you should knock off!
Mobile Banking
With the increasing use of smartphones, banking has also become smart for its users nationwide.
Mobile banking has allowed various banks to formulate their personalized mobile applications.
Bank mobile applications create exclusive digital payment methods and other facilities for their customers.
Banking Cards
Often recognized as ‘plastic money’ a.k.a. banking cards have changed the culture of digital banking services in India to a great extent.
There is a wide variety of banking cards available to customers by numerous banks like- debit cards & credit cards, that offer both prepaid and postpaid services at the time of purchase.
Instead of using cash, people have now started paying money via cards.
Usually, a PIN or an OTP is generated before the transaction that acts as a safety net for the user’s privacy of data and funds.
Also Read: Let’s Decode Personal Finances for Gen Z: The 50-30-20 Rule
Digital payment methods like digital wallets, UPI etc. are after all the new normal when it comes to transactions and exchange of money in 2021.
We at NuCash understand the growing need and helps you become a modern banking user as well.
NuCash with its digital services like mobile wallets and cashless transactions is exactly what you need to be one of the ‘smart’ banking users in today's time.
Our app is launching super soon, so stay tuned to experience a universe of banking services at your fingertips!
Also Read: The journey of GenZ to GenFin - Importance of Financial Literacy
FAQs:
Q1. Do I always need an OTP to make a transaction on UPI apps?
Yes. A UPI app requests an OTP or a UPI pin. Post that, your registered mobile number generates an OTP, once the OTP is verified the transaction goes through.
Q2. How many banking cards are there?
There are three types of cards- Debit, Credit & Prepaid.
Debit card allows a person to withdraw cash up to the fund limit present in the user's account.
Credit cards allow users to withdraw beyond the amount present in the user’s bank account.
Banks/non-banks can issue prepaid cards. To avail, the user has to pay a certain amount in advance.
Also Read: 5 ways to start your journey to financial independence at the age of 18
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