What is Electronic Payment

What is Electronic Payment

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A handy guide on what is e-payment and its various advantages.

Key Takeaways

  • Electronic Payments entail the transfer of funds through electronic or digital mediums.
  • You can choose from different e-payment methods like mobile wallets, bank cards, mobile banking, etc.
  • E-payments are quick and efficient, and the fund transfer typically takes place instantly.
  • It is a secure mode of making payments.
  • E-payments eliminate the need for cash payments, and funds are transferred directly into mobile wallets or bank accounts linked to the mobile number.

With the banking and tech industry achieving one milestone of convenience after another, the way we make payments has been revolutionised. It has been established that cash is no longer the kind and that people prefer to have various, internet-enabled alternative payment methods. One such method of making payments is known as electronic or e-payments. Let’s learn what is e-payment and its many advantages in this article.

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What is Electronic Payment and Its Types?

E-payments are an electronic or digital way of transferring funds. Essentially, you can utilise electronic payment methods to transfer funds as an alternative to cash payments. In India, you can access various types of electronic payment methods based on your requirements.

The various types of e-payment include credit and debit cards, mobile wallets, UPI, internet and mobile banking, and many more. You simply require a bank account and an internet-enabled device to leverage e-payment solutions and pay for various products and services.

Advantages of e-Payment?

The following are some of the critical advantages of e-payments.

Time-Saving

E-payments enable you to make purchases with a simple tap or swipe. Transactions are processed and completed within a couple of minutes. While it is faster than paying with a paper check or other instruments, it also saves you the time and hassles associated with arranging cash.

Efficient

With electronic payment systems, you do not have to wait in long queues at ATMs or bank branches to withdraw cash. The lines at checkout counters are also shorter, with each transaction taking less time. You can also use these online payment systems to pay for a wide variety of products on online shopping websites, thus eliminating the need to visit stores physically.

Cashless Economy

Another advantage of e-payments is that it helps build a cashless economy, especially in the urban areas of the country, by reducing the reliance on cash. Reduced cash usage in the urban sectors enables banks to distribute more cash in the rural parts of the nation where e payments are uncommon.

Security

Cash transactions bring their own set of risks, such as robbery, misplacement, or other similar incidents. However, electronic payment systems come equipped with security protocols that ensure the safety of your funds. Banks use highly secure practices like two-factor authentication, PIN (Personal Identification Numbers) and OTPs (One Time Passwords) to protect your funds from thefts or fraudulent activities.

Certainty

The payments made using e-payment methods reflect in your bank statement or digital wallets. You also receive instant e-mails and SMS alerts after every transaction. You can check for the credit/debit of funds in your account based on the chosen method of e-payment. In case funds are debited wrongly, the transaction is reversed within 24-48 hours.

Final Note

Now that you know what is e payment and its various types, you can choose your preferred method of online transactions. You can also download your bank’s mobile wallet or app to conduct electronic transactions in a secure, hassle-free manner.

Download the digibank by DBS app to get started.

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*Disclaimer: This article is for information purposes only. We recommend you get in touch with your income tax advisor or CA for expert advice.

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