5. Importance of Payment Systems
• Payment systems are the mechanisms
that enable the smooth transfer of
funds between buyers and sellers,
and/or between banks. In the modern
society, no economic activities are
possible without the transfer of money.
In this sense, it can readily be said that
payment systems are one of the most
significant social infrastructures.
7. • A weak payment system may
severely drag on the stability and
developmental capacity of a
national economy;
• The technical efficiency of
payment system is important for
a development of economy.
11. • Систем гэж нэрлэж байгаагийн учир нь
уламжлалт төлбөр тооцооны хэрэгслүүд
болох чек, вексель зэрэг бэлэн мөнгийг
орлох хэрэгсэл, хэлбэрийг ашигладагаас
үүдэлтэй юм.
• Компьютер болон электрон харилцааны
хөгжлийн үндсэн дээр олон төрлийн
электрон төлбөр тооцооны системүүд бий
болсон байна. Тухайлбал, Зээлийн карт,
электрон хадгаламжийн шилжүүлэг, онлайн
банк, онлайн худалдааны төлбөрийн систем
гэх мэт.
12. The History of Electronic Payments
• The first payment cards: from idea to
realization
• The idea of payment by prepaid cards
appeared over 136 years ago, in the
distant 1880. It was then that the famous
American scientist Edward Bellamy in his
book “Looking Backwards” proposed to
use prepaid cards in settlements.
However, his promising idea fell on deaf
ears. After nearly a quarter of the century
in 1914, there were the first attempt to
use credit cards, however, all failed. As a
result, for more than 35 years nothing has
happened in principle to the idea of
electronic money.
13. • In 1950, IDC (Diners Club International) issued
the world’s first universal payment card – Diners
Club. Following this, the very next year after DCI
initiative, Franklin National Bank, the American
Bank issued the first credit card. Seven years later
Bank of America, the largest U.S. bank in the
country, issued the first universal bank card –
BankAmericard, which is now known worldwide
under the name “Visa”.
14. Payment system has 2 types:
National
payment
system
Cross-border
payment
system
16. Улс дамнасан төлбөрийн систем
• Globalization is driving corporations to transact
more frequently across borders. Consumers are
also transacting more on a global basis—buying
from foreign eCommerce sites; traveling, living,
and working abroad. For the payments industry,
the result is higher volumes of payments—in
terms of both currency value and number of
transactions. Interestingly, this is also leading to a
consequent shift downwards in the average value
of these payments.
17. • domestically using clearing and Real
Time Gross Settlement(RTGS)
systems and internationally using
the SWIFT network.
38. Difference Between RTGS and SWIFT
• While RTGS is electronic transfer of funds
within a country, you need a SWIFT code if
you wish to transfer funds electronically to
your relative in a foreign country.
39. RTGS
• It stands for Real Time Gross
Settlement and is the fastest way to
send money from one bank account
to another within the country.
40. SWIFT
• It is best known for its Bank Identifier Codes
(BIC) which are also known as SWIFT codes.
These Swift codes form the backbone of all
the messaging that goes on between banks in
all parts of the world. SWIFT does not
facilitate fund transfers but you need to know
the SWIFT code of the bank in a foreign
country when you are trying to send money
abroad.
41. • SWIFT code is a 8-11 digit code containing alpha
numeric characters. When there are only 8 digits,
it refers to primary office in a foreign country but
when 11 digits are used, one can know instantly
the branch of the bank in the foreign country.
First 4 characters reveal the name of the financial
institution; next two ate meant for the country.
Next two characters reveal the location of the
bank while the last three tell all about the branch
of the bank.
