ENG 102 Assignment: The Benefit of Electronic Money

ENG 102
Professor: Marine
Xuanchang Zhang
04/29/2017
The Benefit of the Electronic Money
The improvement of the modern expertise has resulted in the discovery of an automated currency method. The computerized method constitutes approximately 90 % of all the monetary dealings in the United States. The approach utilized the programmed banker’s technology and the internet backing mechanisms to transfer dollars in the economy. It is slowly replacing the outdated means of exchanging cash, which is perilous and expensive. Besides, electronic cash has enhanced efficiency in the banking field. This paper investigates the benefits of utilizing the automated cash scheme in the economy.
The Americans used cash and checks to trade items and services in the past era. Bank notes were used to make minor disbursements while ordinary checks were preferred in settling huge payments. The use of the actual dollars still persists in the modern society, although it is gradually substituted by the digital currency. The use of automated cards and electronic gadgets has transformed the fiscal aspect of the economy in the United States.
The digital payment approaches have totally reformed the bonds among the customers and traders. The technology has resulted to an ethical financial progression, thus expanding the level of uptake. Consequently, more employment opportunities have been created, hence enhancing the economic productivity and minimizing poverty in the society.
Types of the Electronic payment Schemes
There are two electronic payment systems one is electronic cash also known as the token-based system and secondly the credit-debit also known as account based systems (Abrazhevich, 83). Token-based system refers to a system where one has to feed money into a card before using it or one can be able to access the money in their account. With access to the funds in their account or money previously loaded, they can then use them for their own liking. The account-based system is one whereby an individual has access to money that they do not have but are using it on behalf of the bank. Once they have made money, they will repay the bank usually at an interest. There are four major classes of the digital financial systems. First, the digital cash approach offers an individual client with a secure, swift and cheap online monetary transaction method. It operates via a manifold network structure as an alternative to the typical financial organizations. Besides, it is mostly used to make small payments. It is transportable and does not rely on other financial systems.
Both the trader and the clients are required to register accounts with a financial organization. The corporation then sends money messages to the client which can be withdrawn through the trader. The amount of cash revealed on the message reflects the actual quantity of funds which can be withdrawn by the customer. In addition, the client can request for the monetary replenishment from financial company. The issuer will verify the details of the customer, disburse the extent demanded, and deduct it from the storage account.
Second, the digital check method is another online approach utilized in the modern monetary sector. They are processed through an online conversation, and the money is paid using computerized systems. The clients are given digital checkbooks by the financial institution. The device is integrated to the monetary structures found in the financial companies. The customer pens and inscribes the digital check, and directs it to the company for dispensation. This mechanism is more secure and convenient compared to the actual notes. Third, the use of smart postcards has transformed the currency structure. These are cards embedded with a loadstone flake which stores all the essential financial particulars of the card-bearer. The client can use the material to access many business activities, and make payment without the need of carrying the bank notes.
Fourth, customers can utilize the online credit postcard to make digital disbursements. It enables the holders to buy items and services on loan basis. Both the client and the trader must subscribe with a financial institution to use this method. The people do not need to queue in a bank to borrow loan to make business matter. This approach is convenient and reliable means of trading without cash.
Benefits of Electronic Cash to the consumers
It is more secure to utilize an automated cash approach than using the real dollars. The system has an internal security mechanism that guarantees protection of the users’ accounts. It is risky to carrying dollars in the form of notes. High unemployment level has increased the rate of crime in the society. Most people are unemployed, thus resorting in mugging of clients from the financial institutions. Although the use of electronic money is not 100% safe, it is much safer compared to carrying cash from one place to the next. Due to the ever-increasing crime rate, the society is becoming quite unsafe and carrying large amounts of cash is increasingly becoming risky. People have reported the loss of huge amounts of cash because of robbery but this can be solved through electronic money. For example ATM cards. Even if the criminals manage to get the pin code of the card there is still a limit on the amount of money that one can withdraw in a single day and this helps curb the crime. Stealing hard cash assures criminals of a big payday however electronic money is proving to be challenge for them since of the many policies that accompany a card or any form of electronic money.
It is also expedient and dependable to use the electronic finance mechanism. The clients do not need to carry bundles of notes to make payments. Besides, no need to line in the financial institutions to withdraw funds. There is no transportation or stacking of notes in the digital financial mechanism. This brings satisfaction to the people, since no vexation in the uptake of the electronic methodology. Carrying large amounts of cash can be not only tiresome but also confusing. When shopping one without electronic money one will be required to carry large amounts of cash which despite being risky can be tiresome. Also due to the returning of the balance the calculations can become confusing to the buyer and lead them to losing money. Electronic money shows the correct amount used for a purchase and the mount that remains in the bank. Electronic money is also safer because it is helping eliminate fraud. Initially people were written checks only for them to bounce after they have sold a product or service.
Moreover, the digital technique reserves the consumer’s time. It is faster to send money via digital cash approach than travelling to drop cash to a client living abroad. The issue of geographical disconnection is a key factor when selecting a means of urgently transferring money. An individual will waste time using the outdated conveyance of notes. Consequently, it is beneficial to utilize the digital financial methods to conduct critical businesses to avoid unnecessary delays. Electronic money ensures the quick and immediate transfer of funds from one account to the next. In the traditional days large amounts of money were rarely carried and people relied on bank checks for large transactions. The problem with checks is that they tend to take several d...