Electronic+Money+and+Banking

== =Introduction=

toc Electronic Technologies have impacted our world in many ways in recent years giving us our computers, mp3 players and access to the internet. However it is the way in which we pay for these new commodities that is truly revolutionary. Due to the resent developments in information technologies the conventional ways of storing and distributing money has been reverted from a once solid tangible note to an electronic almost imaginary currency. These new development of money technologies has allowed for businesses to increase productivity as well as efficiency. Transactions can be made at any street corner with an ATM, or even at the comfort of ones own telephone or computer. Many banks have created their secure online banking services through a safe 128 bit encrypted protocol such as HTTPS which highly protects the transferring of data from being accessed by unatherized personnel. Another online option of payment is done through [|Paypal], also created a very secure system which prevents online crime such as fraud and scam which Ebay or any other shopping sites cannot afford to allow. Some businesses also utilize electronic money through auto deposits in which payment to an employee is transferred directly to his/ her bank account. In cases such as this strict security measures are taken to ensure the safest transfer. However at the same time it is intimidating becasue a source outside of yourself has access to your account. Electronic money is the new way of doing business and from the way it looks, it is not a passing fade, but it is here to stay. Eventually electronic or digital money will replace the traditional coins and bills that we hold in our wallets. .

=Examples of Electronic Money=

Credit Card
A plastic card with a magnetic strip that is swiped in order to make purchases on borrowed money. Depending on the cardholders economic situation and credit reputation a monthly maximum amount of money is allowed to be charged to the credit card. Interest is collected each month in addition to what was spent by the cardholder. Examples of popular credit cards are Visa and MasterCard and Discovery.

Charge Card
Is very similar to a credit card yet there is no interest or monthly maximum. However what is spent on the card must all be paid at the end of the month in full. If one does not make payments they will be penalized accordingly. American express is very popular example of a charge card.

Debit Card
Is a plastic card which allows the transfer of money between accounts. When a debit card is used money is directly taken out of the holders bank account. Debit cards are not like credit cards in the sense that credit Is based on borrowed money. Instead, with debit cards what is in the bank is only what you can spend. Also a private PIN number created in order to use the card. No funds can be transferred without the proper PIN number. Point-of-Sale (POS) terminals allow for consumers to make retail purchases directly with there debit card. The terminal instantly transfers money from the cards holders account to the stores account, making shopping more convient.

Smart Cards
Is a plastic card which is contained with a computer chip that is preprogrammed with a set amount of electronic money. Smart cards are often given away now instead of gift certificates. [|Wal*Mart], [|Canadian tire], [|The Bay], [|Zeller’s] and many more companies now distribute smart cards. Another poplar form of smart cards is the Phone card which is used world wide to save money on long distance calling.

Dexit
Is very similar to a smart card in almost all aspects. Yet the dexit card is not limited to simply a corporation's store. The Dexit card allows consumers to purchase items at any restaurant, store, and any other merchant that has a dexit terminal. Simply swipe your card and the money is taken off you're card and you're done. =Consequences of Electronic Money=

With these new technologies also come consequences with regard to privacy invasions. Electronic banking has been susceptible to fraud, and the failure of security for internet users that use e-banking has put many people in the middle of many scams involving their life savings. Like with anything else individuals have to be very cautious with their personal information. The following link demonstrates recent cases that involve fraudulent emails claiming to be from legitimate financial institutions, and asking individuals for their personal information. [|Secure Online Banking]


 * Bibliography**

Ebert R.J., Griffin R.W., and Starke F.A. (2004). Business Fifth Canadian Edition. Upper Saddle River. Pearson Prentice Hall.

Investopedia.com (2005 ) **Credit, Debit And Charge: Sizing Up The Cards In Your Wallet** [online]. Edmonton: Investopedia.com. Available from: http://www.investopedia.com/articles/pf/05/cards.asp [Accessed February 20, 2006]

Image: "Computer Money," Emediawire. [|]