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We have come a long way in the digital economy. The nature of payment systems has transformed significantly over the years, from a simple trade system used thousands of years ago to the dawn of currency and cash transactions. Today, there are different ways you can pay online as digital payments are powered by innovative technology. The idea of a cashless culture has become an easy, convenient, and secure method to carry out financial transactions. The digitization of payments has expanded additional steam in the past years, and new changes are predicted in the future. Besides ease and safety, there is a sturdy push for contactless payments in the post-COVID world, which has specified further drive to digital payment innovation.
Types of Online Payment Approaches
As part of encouraging cashless transactions, several modes of digital payments are available. Understanding how online payments work and picking which means work for your requirements go hand-in-hand. Here are a few most widely used digital payment approaches that are trending today:
Debit and Credit Cards are among the most commonly used payment methods comprising various features and benefits, such as secure payments, convenience, rewards, etc. The main advantage of these banking cards is that they can be used to make new forms of digital payments. With such a card, one can store card info in digital payment applications or any mobile wallets to make the payment. From your local grocer to leading restaurants and trade outlets, you can pay with your Debit/Credit Card. Such cards offer the advantage of purchasing anything at any time through online transactions.
UPI (Unified Payments Interface) is a kind of payment system through which you can send and receive money from anyone holding any bank account. The facility permits users to link more than one bank account on a UPI app on their mobile phones seamlessly. These days, almost all e-wallets, like Google Pay, Phone Pay, and Bhima, also support the UPI to allow users to send money without a bank account or IFSC code. To use this facility, one should have a valid bank account and the registered mobile number associated with the same bank account.
Mobile wallet has grown into the recent trend of online payment that can be used by downloading an app. Rather than doing the tiresome job of entering card information every time during online payment, now users can effortlessly pay through mobile. These wallets stores bank account, debit/credit card, or bank account info in an encrypted format to permit secure payments. It allows you to make transactions with a single tap, saving a lot of time. Some of the mobile wallet applications frequently used are Paytm, Mobikwik, Freecharge, Airtel Money, Oxigen Wallet, and mRupee, among others.
Internet banking is also known as online banking. It refers to the method of carrying out banking transactions online without visiting the bank in person. It allows you to transfer funds, request an account statement, open a new fixed deposit (FD) or recurring deposit (RD), closing an account, etc. Internet banking supports fund transfers via NEFT, RTGS, or IMPS. You can also keep track of your account transactions and balance at all times. Customers can log into internet banking using a username and password to avail all types of banking services. This facility can be used for any transaction that can be availed at any time, 365 days a year, as long as there is an internet connection.
One of the significant benefits of mobile banking is the accessibility of banking services through smartphones. The majority of banks have their applications, and customers can download the same to carry out finance-related functions. You can check account balance, view transactions, transfer funds, pay bills, manage investments, etc., on a secured platform.
Buy Now Pay Later (BNPL)
The concept of BNPL is not a new one. Particularly in a country like India, paying for groceries at the end of the month has been a fairly common practice for years. This practice used to be categorised under the Khata system. This new concept of BNPL is simply a revised app-based version of the Khata. This form of payment has been gaining traction across the country in recent years.
Digital payments are rapidly gaining popularity; we continue to see the growth of various alternative payment methods. One of the significant benefits of cashless payments is that the companies promoting digital alternatives provide adequate security and speed up the payment process. Before the transition clinches, several new trends will appear and disappear. These tendencies will play a significant role in determining our upcoming payment methods. We are definitely on the path where technology will take superiority, and the use of cash would end significantly.