Electronic FundTransfer
-by Anjali, Ayush,
Janvi, Prajwal,
Prathamesh,
Prathama.
1. What is Electronic Fund Transfer?
2. How does EFT works?
3. Benefits and Limitations of EFT
4. Electronic Clearing System
Content 5. Applications of EFT
6. Modes of EFT in India
7. Conclusion
What is Electronic Fund
Transfer?
A system of transferring money from one
bank account directly to another without any
paper money changing hands.
EFT refers to any transfer of funds initiated
through an electronic terminal, including
credit card, ATM, Fedwire and point-of-sale
(POS) transactions.
Process of Electronic Fund Transfer:-
To perform EFT, both sender and the recipient should have their respective bank
accounts.
How does
EFT allows to make payments via computer, using card readers, or over phones
with the help of Internet.
The sender must know the recipient’s bank account info.
EFT works? EFT payment should be an authorized
Money is transferred from one account and deposited into recipient’s account.
The Electronic Fund transfer Act
(EFTA) protects consumers when
transferring fund electronically.
The EFTA was enacted in 1978 as
a result of the increased use of
ATMs.
Protection under the EFTA
includes transfer made via ATMs,
debit cards, credit cards, direct
deposits, point-of-sale, and phone.
Benefits and
Limitations of EFT
Benefits of EFT are:
• It is easy and convenient.
• It is fast and secure.
• It is efficient and less expensive than
paper cheque payments and collections.
• Has less administrative procedures,
hence reduced labor and staff costs.
• The money moves to the recipient’s
account much faster since there is no
manual moving of checks from one
bank to the other.
• For instance, it eliminates the need
to carry huge amounts of money.
• Increased Sales.
• Reduced transaction costs.
• Anytime and anywhere.
• Record of transactions.
• Right to dispute a transaction
completed by EFT.
• Customers can set up automatic
payments with EFTs.
Every coin has two sides!
Drawbacks of
using EFT
Limitations of EFT are:-
• Customer need to have the funds
available immediately
• You won’t receive a copy of the
canceled check
• It creates purchasing opportunities
around the clock
• Payments can still “bounce” when
using an EFT
• It is almost impossible to bank
anonymously in the United States
• If you lose money in a wire transfer it
may not be recoverable
• You cannot grantee the recipient
unless it is yourself
• Some ETFs must get reported to the
government
• Wire transfers can sometimes get lost
• The fees for some EFTs can be
somewhat high
What is Electronic Bank
Clearing System?
Electronic Clearing System Making Payment
(ECS)
Electronic Clearing System (ECS) is an
electronic method of fund transfer from one Utility company
bank account to another. It is generally used
for bulk transfers performed by institutions
for making payments like dividend, interest,
salary, pension, etc. ECS can also be used to
pay bills and other charges such as payments SIP investment
to utility companies such as telephone,
electricity, water, or for making equated
monthly instalments payments on loans as
well as SIP investments.
Types of Electronic Clearing system
ECS Credit System ECS Debit System
• ECS Users • Raising debits
• Regular Payments • ECS mandate
Applications
Types of EFT are:
• Direct Deposit
• Wire Transfer
• The Electronic Federal Tax Payment
System
• ATMs
• Debit Cards
• Electronic Checks
• Mobile wallets
• Personal computer Banking
Modes of EFT
in India-
NEFT- National Electronic Funds
Transfer
RTGS - Real Time Gross Settlement
IMPS - Immediate Payment Service
EFT Act:
• The Electronic Fund Transfer Act was passed by the
U.S. Congress in 1978.
• To establish the rights and liabilities of consumers as
well as the responsibilities of all participants in
electronic funds transferability.
• E l e c t r o n i c Tr a n s f e r F u n d s h a v e b e e n
around for many years and the
economy has greatly benefited from
Conclusion •
the technological advancement.
An Electronic payment system has
facilitated monetary transactions
and even provides a way to finance
everyday purchase.
k You
ha n
T
