As commerce, e-commerce, economy, and technology expand, the variety and volume of the transactions made increases exponentially. Using physical cash for all these new types of transactions is impossible. Banks and financial institutions have eased the process by offering various modes of payment systems that get the job done without any physical exchange of hard cash, but even these seem to be struggling to keep up with the pace of innovation.

A payment system is any system that is used to settle financial transactions through the transfer of monetary value, and it needs financial institutions, individuals, instruments, procedures, technologies, standards, and rules pertaining to the particular system, that make it possible. Payment systems consist of paper based mechanisms that handle checks and paperless methods for electronic transfer of funds.

These systems are unique in that they allow for cash substitutes. With the emergence of electronic communications and smartphones, there has been a large number of electronic payment systems to complement the paper based mechanisms.

Impacts Of Payment Systems
Over the past 50 years, the proliferation of payment systems has revolutionized how consumers pay for their goods and services, how merchants and business people manage their businesses, and how governments make and collect a number of payments.

Payment systems have led to a great efficiency in payments, and have seen an emergence in the use of accounts relative to that of cash. This has in turn reduced the amount of time that money lies unused in an account between successive payments, shortening the intervals between inflow and outflow. This situation has been reflected in a higher market turnover, since it has become evident that many people are able to utilize these payment systems to monitor their cash flow.

Payment systems provide the users with a secure and very convenient way of accessing their money in addition to reducing check and cash handling for merchants. More importantly, these systems have led to more inclusion in the customer base by giving people who had no access to a formal banking platform.

There is a strong correlation between payment systems and financial stability, for individuals, institutions, and nations. Electronic and paperless payments give governments the ability to collect additional taxes (which some would argue that higher taxes actually worsens an economy). These systems can also reduce friction in the overall economy & for individuals, often leading to widespread spending.

Payment systems continue to change. Where fifty years ago, a merchant had to identify and verify the financial ability of a customer through a gruesome process that lasted for weeks, this system is now long gone. Today this authentication process can happen electronically and in real time. Mobile technologies are in the fast lane, making PCs and laptops almost obsolete in online purchases and transactions (in necessity, though they are still widely used by many).

Types Of Payment Systems

Cash Payments
Cash is by far the oldest mode of payment and is most suitable for small purchases as it doesn’t involve any credit, or lugging around a big suitcase full of gold or cash. Although carrying large amounts of money can pose some security risks, some people prefer this from time to time for convenience and flexibility.

Paper Based Payments
These kinds of payments come in the form of cheques, payment orders, demand drafts, warrants, refund orders, etc. These are safer than using cash and are preferred for dealing with large amounts of money. The downside is that they can take about 3 to 4 working days for the availability of the funds. In addition to this, there is the possibility of a cheque being dishonored by a financial institution (bouncing) as a result of insufficient funds and a myriad of other administrative costs.

Card Based Payments
Card based payments systems involve the use of Credit Cards, Debit Cards, NFC Smart Cards, any other ATM card, or even gift cards. These are faster than paper payments and are much safer for the merchants, as the card is only accepted if the user has funds or credit in his/her account. They pose less risk if stolen than cash – as they can be cancelled, and they can also be used for online financial transactions. Unlike cash or hard assets, however, cards usually contain personal information, and can even have this information (including the card number itself) stolen through various methods.

Electronic Payments
With the advent of internet services and smartphones, there has sprouted a widespread use of these two tools as payment systems. They have brought about electronic fund transfers, mobile banking, internet banking, e-commerce, digital wallets, etc. These systems have made it very simple to pay for services, buy goods, and transfer funds by using smartphones or electronic devices. They tend to be pretty safe as the best of these systems have secure protocols for their customers.

Every new revolution of payments made in history, from barter trading to utilization of e-wallets has been largely driven by the customer’s need to find an easier, convenient, and safer way to pay for services and goods. The card system has freed users from having to carry around cash.

The shift from cards to mobile is also driven by this idea. There is a wind of change that has caused extensive education of the society about mobile and e-payments.

With the global market becoming linked through the internet, the online payment systems (digital wallets) have enabled secure and comprehensive services that handle financial transactions in a cheaper and very effective manner. The emergence of cryptocurrencies and blockchain services have sealed the gap and revolutionized money transfers.

Blockchains.my (now bcmy.io) is a new and advanced mobile wallet app, which can also act as a  payment getaway for merchants. This digital wallet offers four layer user verification and facial recognition that has made it among the most secure applications. It monitors the changing prices of Ether (ETH), Bitcoin (BTC), Gold Smart Contracts (GSC) and DinarCoins (DNC) and then uses this real time information to conduct transactions. Blockchains.my is compatible with debit/credit cards, QR codes, and NFC Smart Cards.

In this highly monetized economy, there is need to transact business freely and easily. Blockchains.My (bcmy.io) gives you the platform to seamlessly take control of all your business transactions. With our secured system, we have the ability to change the way you make payments and protect users’ from identity theft. Download the app on the Google Play Store and enjoy easy, secure, and convenient payments.


Resources:
http://www.businessdictionary.com/definition/payment-system.html
http://app.ny.frb.org/CfCBSWEB/Payments_Presentation.pdf
http://smallbusiness.chron.com/cash-inflows-outflows-operations-32743.html
http://www.bis.org/publ/plcy04.htm
http://www.dotorigin.com/smart-card-based-solutions/contactless-and-nfc/
http://www.investopedia.com/terms/e/ecommerce.asp
e-Commerce, also see: http://www.top10ecommercesitebuilders.com/
http://electronics.howstuffworks.com/gadgets/high-tech-gadgets/digital-wallet.htm
https://www.disruptordaily.com/top-10-best-cryptocurrencies-2017/
https://www.coindesk.com/information/what-is-blockchain-technology/
https://bcmy.io/
https://www.ethereum.org/ether
https://www.bitcoin.com/
dnc.dinardirham.com