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Understanding what is digital payment and the various methods.
The increased use of smartphones and the internet has paved the path for several different payment methods. Today, you can conduct cashless transactions and support the Digital India initiative by the Indian Government. This has all been made possible because the population has embraced digital payment systems. Read on to learn about the types of digital payment methods in India.
Digital payments are essentially payments conducted through electronic, internet-enabled mediums. You can complete these transactions via internet-enabled devices, on which you can access your savings account and conduct various banking transactions, including fund transfers. You can choose from a multitude of digital payment options to conduct digital transactions.
Having explained what is Digital Payment in India, let us understand the different payment methods.
Bank Cards include credit, debit, and prepaid cards offered by banks. Not only can you choose from a variety of Bank Cards, but they provide a convenient and secure way of making payments. You can safely use two-factor authentication to enjoy online shopping and make payments at Point of Sale (PoS) machines. You may also use bank cards at Micro ATMs (Automated Teller Machine) to digitally complete transactions.
United Payments Interface (UPI) allows you to link multiple bank accounts through one mobile application. This mobile banking application enables you to enjoy banking features and conduct merchant payments simultaneously. You can download your bank’s mobile UPI app on your Android or IOS enabled smartphone and conduct the transaction.
Internet banking, also known as online banking or e-banking, allows you to conduct various financial transactions digitally. It is an electronic payment system wherein you, as the customer of the bank, can use its website to initiate digital payments. You can also use internet banking services like IMPS, NEFT and RTGS to transfer funds securely. You can also send funds via these methods through the Mobile Banking App of your bank. You need to download the bank app on your phone, log in, and choose your preferred type of digital payment system to complete the transaction.
You can carry cash digitally by linking your credit or debit card to mobile wallet apps, downloadable on your internet-enabled smartphones. You can link your bank account or bank cards to the digital wallet and load money on it. Once done, you can use the funds in your digital wallet and make payments via your smartphone, tablet, and even smartwatch.
There are various advantages of Digital Payments that make it a convenient fund transfer method. You can conduct instant and quick payments in seconds with such cashless payment options. You can choose the type of digital payment system based on the fund transfer amount. While digital wallets are ideal for smaller transactions, it is better to use bank cards, and internet and mobile banking for high-value transactions. The good news is that Digital payment services are available 24x7, 365 days. All these features make digital payments the most viable payment service in India.
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*Disclaimer: This article is for information purposes only. We recommend you get in touch with your income tax advisor or CA for expert advice.
