Electronic Fund Transfer | Types | Advantages

Electronic Fund Transfer:- Development is on its height today. New inventions are taking place every now and then with the launching of technical products and technical methods of getting things done.

Electronic Fund Transfer – Introduction

Electronic Fund Transfer is also one such way of transferring money that has immensely found its place among the people. It refers to the transaction of money from one account to the other just through a computer or a mobile network. Here the cash does not need to be given or taken but still, the amount is transferred in the electronic form.

The value of the Electronic Fund Transfer system can be realized from the fact that it is being used at such a large scale by the e-commerce sites. Whether it is Flipkart or ebay or any other similar company, these have been making use of this technology to its maximum. Due to the benefits, customers also find it great.  

Various forms of Electronic Fund Transfer

Let us have a look at the various forms of Electronic Fund Transfer.

  • Debit card or credit card: Being the most common way of payment, the use of debit and credit cards is on a high. The customers can easily transfer money through their cell phones to the shopkeeper’s account from their own account.
  • Online Bill Payment: This again is a greatly used way through which one can pay the monthly bills from their mobile phones sitting at homes. There is no need to stand in a queue waiting for the turn. This is also called online banking in which money is electronically transferred.
  • Direct Deposit: This is a method to get your income from your employer and in a way is the only method used by some.   
What Is Electronic Fund Transfer
What Is Electronic Fund Transfer

Advantages of Electronic Fund Transfer

It is the vastness of the benefits one gets from EFT that it has become so popular. Let’s see these benefits.

  • Paperless: EFT saves a lot of money for some who would have otherwise had to send money through cheques. Another benefit goes to the environment as there is no use of papers.
  • Highly convenient: That time is gone when you had to travel so much, stand in queues to pay bills and face the weather conditions. Sitting at your homes, you can complete your tasks in just a few clicks.
  • Time limit: EFT method can be used at any time of the day. So no time bondage is there.
  • Safe and secure: It lets you do the transactions in the safest way as you do not have to carry bags full of money or papers from one place to another. You can be free from the fear of destruction or robbery.
  • Saves time and effort: It is quick. It does not require much effort from you. You save a lot of time.

Disadvantages of Electronic Fund Transfer

EFT does carry some drawbacks as well. Following are some of them.

  • Not for all: Only those can use the EFT who know how to work on mobiles or computers well enough, otherwise mistakes too can happen.
  • A need for an online network: Without an internet connection, EFT is of no use.
  • Limits on transactions: There are certain limits out of which no transactions can be made. A limited amount of money can be transferred.
  • Hacking and loss of privacy: Hackers can lead to the loss of money as well as the privacy of the details.

Needless to say, Electronic Fund Transfer is something the world will find difficult to live with in spite of the drawbacks.

If you like this information then please do share it with your mates so that they can also get familiar about their day to day transaction method.

If You have any doubts regarding this information then you can ask on our contact us page or directly put your doubts in the comment section below. We will definitely answer that for your convenience.

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