The Application of Pre-Paid Cash Card for Consumers

A stored-value card represents money on deposit with the issuer, and is similar to a debit card. One major difference between stored value cards and debit cards is that debit cards are usually issued in the name of individual account holders, while stored value cards are usually anonymous.

The term stored value card does not necessarily mean the funds data is physically stored on the card. In many cases the data is maintained on computers affiliated with the card issuer. The value associated with the card can be accessed using

• ~ a magnetic stripe embedded in the card, on which the card number is encoded,
• ~ ratio-frequency identification (RFID), or
• ~ by entering a code number, printed on the card into a telephone or other numeric keypad.

The Touch ‘n Go smart card is used by Malaysian toll express way and highway operators as the sole electronic payment system (EPS). The credit card sized smartcard is mainly used for toll way fares. It is designed to ease the queue congestion at toll plazas and some drivers use together with SmartTAG (a non-stop electronic toll collection system).

Besides, the card can be used as an integrated ticket in Kuala Lumpur public transport system. So far, there are 3 companies had implemented the card into their fare collection system which are Rapid KL, KTM Komuter, and KL Monorail.

The Oyster card is a form of electronic ticketing used on:

• ~ Transport for London, and
• ~ some National Rail services within the Greater London area of the United Kingdom.

It is the same contactless smartcard as Touch ‘n Go card in Malaysia. The technology used for the oyster card is known as RFID, which is the same technology used in other electronic pass cards used all over the world, like Japan’s Suica fare cards.

The Octopus card is a rechargeable contactless stored value smartcard used to transfer electronic payments in online or offline systems in Hong Kong. It is launched in September 1997, and has since grown into a widely used payment system for virtually all public transport in Hong Kong. It is also used for payment at convenience stores, supermarkets, fast food restaurants, on-street parking meters, car parks, and other point-of-sale applications such as service stations and vending machines.

It has been internationally recognized, winning the Chairman’s Award or the World Information Technology and Services Alliance’s 2006 Global IT Excellence Award for being the world’s leading complex automatic fare collection and contactless smartcard payment system, and for its innovative use of technologies.

Causes & Prevention of Credit Card Debts

In 2007 there were over 2.3 million bankruptcies, the majority caused by unmanageable credit card debt. Is this credit card holders did not realize when banks approved their credit card and established their credit limit? This is an alarming signal that should get everyone's attention. Below are some causes and prevention of credit card debts.

Causes

1) Less income but more expenses
It so happens that the main breadwinner of the family loses the job but monthly expenses are not cut down in line with the reduction in income. This obviously leads to a rise in debt as the family is forced to use their credit cards for groceries, utilities, and expenses.

2) Poor money management
Poor money management is one of the reasons why there is an accumulated of debts. Not having a monthly spending plan and not keeping track of the monthly bills will make us unaware of where the money is going. Sometimes we might overspend without realizing it. Also, we might purchase useless items that charging on the credit card, thus have to pay interest on these purchases every month.

3) Medical expenses
Nowadays, the medical expenses are increasing every year. This is because almost every doctor accepts credit cards payments as it is so convenient. Patients are used to make credit card payment when they need treatment although they do not have enough savings in the bank account.

4) Gambling
Most people hope to win the lottery but the chances of that happening are 0%. They spend tomorrow's saved money today just because they expect a promotion in the job or are expecting an inheritance income without need to work hard. They may use the credit card to make gambling payments and this will eventually burden their life as they have accumulated too many debts.

Prevention

1) Stop adding the credit card debts
To eliminate credit card debt stop adding to the problem. If there is thousands of money in debt and continue spending more on the credit cards than this make thing obviously to get worse. We must stop using credit card to borrow from tomorrow for what we want today.

2) Set up a budget
This can be a difficult exercise for many of us since easy access to credit cards allows us temporarily to hide the truth that we spend more than we make. Budgeting helps to highlight how much wasteful and unnecessary spending we engage in that can be curtailed without undue pain. Nondiscretionary items such as mortgage or rent, utilities, food and insurance take up the bulk of most household budgets but it's important to allow ourselves to have some savings if possible.

3) Use cash rather than credit cards when possible
There is a reason that casinos give chips to spend instead or requiring cash: People do not attach the same value to noncash substitutes and will spend and bet more freely. It's the same with credit cards, and retailers know it. People spend more when using a credit card versus cash for purchases. So, next time you buy pair of new shoes or the latest CD, just try to pay by cash.

4) Get a better rate on your existing credit card
If you have thousands in personal debt it can really help the monthly cash flow if you are able to transfer those balances onto a low interest credit card.
Your credit rating will generally determine whether you can be eligible for the lowest rate offers but it could definitely be worth the effort. The low introductory "teaser" rate will last for only six to 12 months, but a smart consumer will use that time to aggressively paying down the debt, not running up more debt.

References:

1. http://www.fastweb.com/fastweb/resources/articles/index/102925
2. http://www.bankrate.com/brm/news/debt/debt_manage_2004/top-10-causes.asp

Electronic Currency

The president and CEO of the Federal Reserve Bank of Cleveland, says,” money in the 21^st century are proved to be different form the money of the current century as our money is from the previous century. Just like fiat money replace specie backed paper currencies, electronically initiated debits and credits will become the dominant payment modes, creating the potential for private money to compete with government-issued currencies." In the era, new developments in electronic currency are emerging. Therefore new catchphrases such as smartcards, online banking and electronic currency are being used to discuss money. However, what are these new forms of money? Who will use them? And how do they work?

What is Electronic Currency?

Cash is known in various forms as a tool of exchange and of storing value Although the coins and banknotes that are now abundant in their basic form have existed for thousands of years, the first bank note of the Swiss Federal State, surprisingly did not appear until 1907.

Today, nearly all of the deposit currencies in the world's banking systems are handled electronically through a series of inter-bank computer networks. Although banks have been able to move currency electronically for decades, only recently has the average consumer had the capability to use electronic transfers in any meaningful way.

Electronic currency is essentially a system that allows a person to pay for goods or services by transmitting a number from one computer to another. . Thus, electronic currency is the digital representation of money, or more accurately, the digital representation of currency.

Further Reading: Has the time for electronic currency come?

Mobile Payment Systems in Malaysia: Its Potentials and Consumers' Adoption Strategies

Mobile Payments (M-Payments) Introduction

M-payments are payments made using mobile handsets and other devices, either to directly purchase or to authorise payment for goods and services. Such devices are playing an increasing end evolving role in the wider development of electronic payment systems around Asia Pacific, which includes Malaysia.

Mobile network operators (MNOs) have played an important role in pushing the technology necessary for m-payments. In many cases, however, the early efforts to launch m-payment services were met by suspicion from financial institutions, including banks and card companies. Just a few years later, these stakeholders are now collaborating to trial a range of services including:

~ m-banking
~ m-wallet solutions that store credit or debit card information on a SIM chip
~ pay-as-you go or 'contactless card' technologies
~ text messaging systems that can facilitate or enable payments.

MNOs are approaching m-payments strategically, in their bid to retain customers and develop wider sources of revenue from lines of business which can be strongly complementary. Fixed-mobile convergence is one manifestation of this, as it gives telecom operators an opportunity to unify their payments platforms on an internet protocol basis and offer discounts or loyalty points on m-payments as part of bundled service.

M-Payments As A Channel

The speed with which mobile technologies are being adopted shows no sign of relenting. The number of people using mobile phones overtook the number of fixed line phones. Even people without bank accounts often own mobile phones and have incorporated them into their way of life.

Along with the spread of mobile networks globally, there have been major advances in technology, especially in the 'secure element' aspect of SIM cards. This has made financial institutions in particular feel more comfortable about the potential for adoption of m-payment systems.

While banks are starting to explore opportunities in m-banking, other sectors are also embracing these new technologies. For example:

~ Transportation companies are offering 'touch and pay' access to ticket barriers where a stored-value card is either attached to the handset, or embedded in the SIM
~ Retailers are offering loyalty cards, using similar means of payment, as they seek to reduce the amount of cash they have to handle and carry
~ Credit card companies see mobile handsets as a means to widen their catchment of commercial transactions
~ Advertisers are building web-links into posters in trains and buses and on buildings which can be activated by 3G+ phones from short distance leading to more website visits and more purchases by mobile phone
~ Vending machine operators sell soft drinks and other consumables by enabling payment by phone
~ Content providers, including music and information sites, auction sites and rapidly growing Web 2.0 community sites such as MySpace and YouTube, become globally accessible to paying customers.

These initiatives show that there is not only one comprehensive e-payments marketplace, but rather an increasingly diverse range of ecosystems. Payment platform companies such as PayPal can potentially link the vendors with these different ecosystems - but they can also operate quite independent of each other.

Business Models And The M-Payments Value Chain

There are five types of mobile payments, each driven by different incentives and revenue-earning opportunities. These are business-to-consumer (B2C), business-to-business (B2B), consumer-to-consumer (C2C), person-to-person (P2P) and remittance. These can be further categorised as commercial transactions (B2C, B2B and C2C) and private transactions between individuals (P2P, remittance).

Emerging Business Models

Malaysia's m-payment market has developed more quickly, but less organically than the Thai market. Emerging services have received government support, but uptake in the market has been limited. Existing services are focused predominantly on bill payment and m-banking, growing slowly into m-wallet services, remittance and top-up/transfer offerings.

Maxis and Maybank in Malaysia both provide a simple m-banking service for subscribers (bill payment, balance enquiries, fund transfers), which can also be used to top-up Maxis accounts, download Maxis content and pay for products such as pizzas and movie tickets. Maxis also began international remittance services, but only with Globe subsribers in the Philappines. Maxis customers are changed less than half of what the banks charge for sending money overseas.

Another Maxis competitor, Digi, is providing many of the same services - except that its remittance business is focused on Indonesia and it banking partner is Citi's Global Transaction Services.

An interesting twist on the payment gateway model has been provided by Mobile Money International (MMI), a samll Malaysian company, that focuses on enabling m-transfer functions (limited m-banking or m-wallet services). This is in contrast to the early Korean PG provider focus upon content and downloads - perhaps reflecting the more conservative, less digitally aware make-up of the Malaysian market. MMI's transaction fee is in contrast to the existing bank rate (depending on the merchant size). By 2007, MMI had some 12,000 partner merchants. The largest partner merchant is Tenaga Nasional Berhad (TNB), Malaysia's main energy provider, however, the vast majority of the merchants are small.

There are two possibilities for future development. The first is in the growth of P2P and remittace usage nationally. The second is in the development of content, or value-added, downloads - both of which could dramatically drive these markets.

Industries Perspectives On M-Payments

In recent years, companies from a wide range of sectors have adopted and participated in different tupes of m-payments. The transport industry, for example, is the champion of contactless or'tound-and-pay' solutions, whereas the retail industry has driven m-wallet applications. Each of these types of m-payment have different value chains.

The industries most directly involved in the uptake of m-payments are telecommunications, banking, retail, transpostation, media and entertainment. Different mobile payments business type are being adopted by each industry:

~ Telecommunication: content downloads, top-up and m-wallets.

~ Banking: Mobile banking.

~ Retail: M-wallets, touch-and-pay, remittance and auction.

~ Transportation: Touch-and-pay and m-wallets.

~ Media and entertainment: Content downloads, payment gateways and m-wallets.

* Touch-and-pay = 'Touch-and-Go' (Touch 'n Go) transport smartcards, used for expressway tolls and public transport, are provided by Touch 'n Go Sdn Bhd (formerly known as Rangkaian Segar Sdn Bhd).

Reference:

http://www.neowave.com.my/sellmore/wp-content/uploads/2008/01/mobile-payments-asiapacific-kpmg.pdf

A review on a post on Internet Security

In the developed countries with all the high technological equipments and facilities, a number of reports showing that there is a dramatic increase in identity theft. For example, McAfee had shown a report of significant increase in computer security breaches leading to the loss or potential loss of sensitive personal data. Research suggests that the numbers of key loggers, which are codes that put onto the computer without user’s knowledge and consent and tracks, records your keystrokes has increased two and a half times in just over two years. This means ALL keystrokes which are including your personal data, financial details and passwords.

Identity theft is not benign and exerts a powerful and economically significant burden amongst businesses and individuals throughout the world. In Gartner’s study, there is about 15 million Americans were the victims of fraud that origin from identity theft which indicates there is an increase of more than 50 percent from what they estimated in year 2003. The figures actually came from 2 different sources, thus there are two different statistical and methodologies.

At the same time, the research found out that identity theft victims are losing more money and getting less of it back. Besides, hackers nowadays are exploiting internet auctions, non-regulated money transmittal systems and other type of scams. However, there are some organizations being established in order to prevent the theft rate statistic risen and to stop all these threats and attacks incident widely spread.

Reference (Review):

http://ecommerze.blogspot.com/search/label/Internet%20Security

For more information: --> Fraud Watch International

Article Source:

1. http://EzineArticles.com/?expert=Eric_Hartwell\

2. http://ezinearticles.com/?Increase-in-Identity-Theft-Reports&id=