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The Indian Cyber Crime Coordination Centre (I4C) under the Union Home Ministry has issued an alert against illegal payment gateways created using mule bank accounts by transnational organised cyber criminals facilitating money laundering as a service.
Digital payments are transactions that occur via digital or online modes. This means both the payer and the payee use electronic mediums to exchange money.
The meaning of digital payment is equivalent to an electronic payment. Digital payments use a digital device or platform to move money between payment accounts. They can be partially, primarily, or fully digital.
A payment gateway is a merchant service provided by an e-commerce application service provider that authorizes credit card or direct payment processing for e-businesses, online retailers, bricks and clicks, or traditional brick and mortar.
The payment gateway may be provided by a bank to its customers but can be provided by a specialised financial service provider as a separate service, such as a payment service provider.
The payment gateway is a key component of the electronic payment processing system, as it is the front-end technology responsible for sending customer information to the merchant-acquiring bank, where the transaction is then processed.
Mobile payment apps: Apple Pay, Google Pay, Paypal and Samsung Pay
Digital cards: Credit, debit, or prepaid cards issued to a customer’s mobile or digital wallet
Contactless payments: Credit, debit, or prepaid cards with near-field communication (NFC) technology, or mobile wallets that use magnetic security transmission (MST) technology as qualified as contactless payments.
Bank transfers: Direct transfers, also known as ACH transfers, are usually inexpensive or free and take one to three business days to execute.
Biometric payments: Mobile apps and other digital payment agents use biometric verification to authenticate transactions. For example, smartphones can send information with a payment request that includes biometric information.
National Electronic Toll Collection (NETC) FASTag: This interoperable solution uses Radio Frequency Identification (RFID) technology to allow individuals to make toll payments while their vehicle is in motion.
Reference -
https://razorpay.com/learn/digital-payments-india-definition-methods-importance/
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PRACTICE QUESTION Q.Discuss the role of digital payment gateways in promoting financial inclusion in India. Highlight the challenges associated with their security and the measures needed to prevent cyber fraud. (250 words) |
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