What is an E-payment?
An E-payment system is a way of making transactions or paying for goods and services through an electronic medium, without the use of checks or cash. It’s also called an electronic payment system or online payment system.
Types of E-Payment System
- Credit Card – A form of the e-payment system which requires the use of the card issued by a financial institute to the cardholder for making payments online or through an electronic device, without the use of cash.
- E-wallet — A form of prepaid account that stores user’s financial data, like debit and credit card information to make an online transaction easier.
- Smart card — A plastic card with a microprocessor that can be loaded with funds to make transactions; also known as a chip card.
- Direct Debit — A financial transaction in which the account holder instructs the bank to collect a specific amount of money from his account electronically to pay for goods or services.
→ Advantages of E-payment system:
- Reaching more clients from all over the world, which results in more sale.
- More effective and efficient transactions because transactions are made in seconds, without wasting customer’s time.
- Convenience because customers can pay for items on an e-commerce website at anytime and anywhere and customers just need an internet connected device
- Lower transaction cost and decreased technology costs.
- Expenses control for customers, as they can always check their virtual account where they can find the transaction history.
- Payment gateways and payment providers offer highly effective security and anti-fraud tools to make transactions reliable.