Mobile Payment System is a new payment method where we can make payment using mobile devices (e.g. Cell phone) instead of with cash, credit cards or cheques. Mobile payments provide quite a number of advantages for its users such as:
1. Security - Two-factor authentication between merchant and buyers to prevent fraud.
2. Convenience - Consumers need not to hold huge amount of cash during shopping
3. Easy & Fast - Buyers only need to integrate their mobile phone to the device and transaction can be done in short time
In Malaysia, mobile payments are being used in various areas:
- Music, Videos, Online Games and other Digital Products
- Transportation Fares and Toll Fees
- Books, Magazines, Tickets and other Hard Goods
- Make payment for phone bills. e.g. Digi 
One of the famous Mobile Payments applications in Malaysia is Mobile Money. It provides convenience to buyers where they can buy product online and make payment without having to present at a physical store. Registered users can pay for merchandises bought by only sending a 6-digit security PIN via SMS using a mobile phone.
Besides that, Visa payWave is another example that provides mobile payment services. Technology used is Near Field Communication (NFC), a short range wireless technology that allows communication between devices at close range. Users only need to get their mobile phone close to a tiny computer chip which sends payment information to a card reader via short-range radio frequency waves. The San Francisco Coffee outlet at KLCC is an example that uses Visa payWave.
Study showed that almost 88% of Malaysian populations are subscribing to mobile phone services but there is only 1.8% from them are subscribed for mobile banking and payment services. This result shows only small portion of Malaysian mobile phone users are being exploited to use of mobile payments. Thus, some strategies should be adopted to attract more users to mobile payment. For examples,
1. Educate Consumers about Usefulness and Functions of Mobile Payment
Merchants that provide mobile payment services can introduce method of using and its advantages to its customers via their official websites.
2. Enhance Security of Payments
Merchants can adopt certification program such as VeriSign to increase consumer’s confidence in securing their confidential information when making mobile payments.
3. Well Designed Payment Process
Mobile payment systems should be designed in an easy and simple model so that users are more willing to adopt mobile payments which are still new to them.
4. Collaborate with More Banks and Companies
This can help to enhance customers’ satisfaction when they are able to pay using mobile payment in a wider range of services.
Related Links:
https://www.digi.com.my/whatshot/promotions/hppaybill/faq.do
http://www.mobile-money.com.my/
http://www.theedgemalaysia.com/technology/16929-visa-rings-in-on-mobile-payment-space.html
http://www.bernama.com/bernama/v5/newsindex.php?id=337023
Other Blog Link in Tutorial 1
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The online form of electronic cash allows for the completion of all types of Internet transactions. While offline form is a digitally encoded card that could be used for many of the same transactions. The primary function of electronic currency is to facilitate transactions on the Internet and its reality is slightly more complicated and makes transactions both secure and private. Electronic currency truly globalizes the economy as users can download money into their cyber-wallet in any currency desired. A merchant can accept any currency and convert it to local currency when the cyber cash is uploaded to the bank account.
An extraordinary success that took place in Hong Kong (Octopus Card), which started as a transit payment system and has grown into widely used electronic cash system. Deposits work of this Octopus Card is similar to banks’. After Octopus Card Limited receives money for deposit from users, the money is deposited into banks, which is similar to debit-card-issuing banks redepositing money at central banks.
Singapore also has an electronic currency implementation for its public transportation system (commuter trains, bus, etc), which is very similar to Hong Kong’s Octopus Card and based on the same type of card.
Digital coins are like travelers checks. It is also called “e-money” and “e-cash”, it is downloaded as “digital coins” from a participating bank into user’s computer, or an account is set up within the bank. Either the digital coins or the transactions that debit the account are transmitted to the merchant for payment. All the transactions are encrypted.
As conclusion, electronic currency combines the benefits of other transaction mediums and allows individuals to conduct transactions among each other.
Related links:
http://en.wikipedia.org/wiki/Electronic%20currency
http://www.anderson.ucla.edu/faculty/jason.frand/teacher/technologies/goshtigian/define.htm
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In this new millennium, it is becoming less for consumers to pay for their expenses by cash. People now are mostly use credit cards to purchase clothes in their closets and to insert petrol for their cars. The unfortunate consequence of this shift in behavior is that credit card debt is become higher. Eliminating this type of debt can be difficult as many people are only able to pay a minimum monthly payment each month and the interest rates are extremely high. Under these conditions, it can take years to pay off even the smallest credit card balance. This is the general consensus of consumer groups on the alarming number of credit card users below the age of 30 who were blacklisted and later declared bankrupt due to credit card debts. So, it is better for us to take some prevention method on the credit card debts.Causes of Credit Card Debts
1. Financial Illiteracy
May be you are not been taught in schools or your parents may not explained to you. It doesn't matter. You are responsible for your life and your money anyway. Financial mistakes are increasingly expensive and complicated to resolve. It is because many people don't understand how to save money and invest for a rainy day, or even why they should balance their checkbook.
2. Underemployment
You might deserve a break but actually it is not a good time. People who experienced under employment may continue to think of it as only temporary or if they are coming off unemployment feel a false sense of relief. Get those expenses in line with your current income. Down the road if you increase your income due to more hours, a better job, or a second job, then it is the time to start adding in some of the previous spending before you become underemployed.
3. Banking and Windfall
Spending tomorrow's money today is very attractive. Especially if you believe that tomorrow the money will come no matter what. A planned job bonus may not be a confirm thing. The inheritance that you believe will come your way may not. The lesson is don’t spend the money until the check clears.
4. Poor Money Management
You may spending hundred of dollars for unnecessary thing for each month.A monthly spending plan is essential. Without one you have no idea where your money is going. Planning is no more difficult, it is just writing down your expenses and income and reconciling the two. You will be surprised at how powerful you'll feel when you are making thoughtful decisions about when and where to spend your money.
5. Medical Expenses
Gaps in coverage, lapsed policies and increasingly costly alternatives make this a popular category. If you think a credit card is very convenient, think again. The medical industry wants to get paid at the time service is rendered. They know that if they don’t, the chances of their getting paid drops. This means more debt for you, less for them.
Prevention of Credit Card Debts
1. Credit Counseling and Debt Settlement
This helps clients by educating them in ways to get out of debt and stay that way, but approaches are significantly different. The objective of credit counseling is to pay off debts in full by negotiating lower interest rates, while debt settlement companies pay off debts faster by negotiating reductions in amounts owed.
2. Choose a Credit Card which Offer the Lowest Interest Rate
Photocopy the credit card offer, including the interest rate and terms. Create a letter to your credit card companies stating that you are thinking of switching to their competitor because they are offering a far more reasonable interest rate. Credit card companies do not want to lose your business. Therefore, they will try to offer you a more desirable interest rate.
3. Manage Your Finances
Starting with a strategy will help keep you on track before you ever even pull out the credit card. Determining your monthly income and needed expenses. As part of these monthly expenses, figure in 5-10% of your income to set aside for emergencies, long range savings such as a retirement account, and short term savings. If you have some savings then you can avoid from putting large amounts of debt on a credit card in times of a crisis.
Related Links:
http://www.mmail.com.my/content/credit-card-debt-and-you-many-unaware-effects-bankruptcy
http://www.nurido.at/news/credit-card-debt-consolidation-loans-require-an-attention-to-detail-124017.html
http://www.nurido.at/news/best-relief-for-credit-card-debt-credit-counseling-or-debt-settlement-123740.html
http://www.bankrate.com/brm/news/debt/debt_manage_2004/top-10-causes.asp
http://www.mozdex.com/prevent-credit-card-debt/
http://www.cardratings.com/howtoavoidcreditcarddebt.html
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Prepaid cash card is similar to debit card, with a card number, signature and company branding. It enables holder to purchase and make payment using an amount preloaded by the holder or someone else. However, it is not like debit card services which links to a bank account with an overdraft facility. Prepaid cash card users are only allowed to use the credit preloaded by them.
It is convenience to keep and use. Users can use it as a substitute for cheques and cash. For example, if prepaid cash card is a MasterCard, VISA or Maestro card, users can use it to make purchases anywhere around the world where those cards are accepted and it is more secure as it can be blocked if it’s lost or stolen.
Users are allowed to use prepaid cash card to buy things at shops, or for telephone shopping, mail order shopping or Internet shopping. Moreover, there are some other prepaid cards such as Touch ‘n Go (TnG) smart card. Users of TnG can use their preloaded cards to pay for highway tolls, Light Rail Transit(LRT) or bus tickets and even car park fees.
Next, Octopus card used in Hong Kong is also one of the examples of prepaid cash cards. This is a smart card that used to transfer electronic payment in online or offline systems. Users can use it for public transport in Hong Kong, payment at supermarkets, convenience stores, on-street parking meters, car parks, fast-food restaurant, and other point-of-sale.
Users of prepaid cards are free from debts as they have no chance to spend exceeding the preloaded amount. This is different from credit cards which require repayments after purchases. Debts are easy to create as credit card users can exceed budget easily.
Besides that, there is no interest charged onprepaid cash cards and it is easy to apply because no credits check is needed. It helps users to control and limit their money spending. They can only spend with the money that is loaded onto the card and spending can be checked via the Internet.
Prepaid cash cards have brought many benefits. People should be encouraged to utilize it in making their purchase transactions.
Images:
(Master Card and VISA Card)
(Touch 'n Go Card)
(Octopus Card)
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