Monday, January 13, 2020

Electronic Funds Transfer Essay

Living in an electronically controlled world today, it is not that hard to accept the fact that almost everything is primarily controlled by technology. Here comes the age when almost everything happens within a single click. Apparently, almost everything in the society happens within seconds. This has been primarily enhanced through the existence of online connections through the development of the internet. The developments of banking systems at the same time have also been pushed through. With the existence of the online trading procedures, the development of fund transfer processes also demanded several progresses in terms of creating the possibilities of handling the money the fastest way possible. To be able to meet the needs mentioned above, it could be observed that the need for express money transfers is heightened. With the many money exchanges happening around the globe regularly, the old system of money transfer that requires time and several complicated procedures of claiming the transferred funds already is being gradually eliminated in the human society. The need for a speed enhanced transfer of money could obviously not be met by the said type of fund transfers. On the other hand EFT’s or Electronic Fund Transfer gives the best possible way of sending money from all over the world towards the different regions of the world. More than that, the security of money transfer has also been heightened by this particular type of monetary transaction procedure. To be able to learn more about the said procedure of money transfer, it is necessary to know the basic information pertaining to its primary developments. How it all Began The developments of EFT’s have been primarily handled by banks who wanted to increase the services that they provide their clients with. It could be noted that through the increased concern of investors and economic enthusiasts in enhancing the processes of fund transfer around the globe gave the bankers an idea on what to actually apply in the procedures of developing the said system of money transfer from person to person and company to company transactions. At first, the development of this particular process assisted on credit transactions, the use of cards in monetary transactions and other basic procedures concerning monetary procedures of transfer. However, when the bankers found out the possibility of utilizing the benefits of online connections in this particular process, the development of the integration of online internet connections within the procedures of completing bank to bank monetary transactions has been pushed through. Now, through the internet alone, investors, businessmen and even just ordinary bank depositors could already transfer and receive funds through the internet. The said procedure of monetary fund transfer enhancement also involves several other types of other monetary transactions such as: †¢ Sale: where the cardholder pays for goods or service. †¢ Refund: where a merchant refunds an earlier payment made by a cardholder. †¢ Withdrawal: the cardholder withdraws funds from their account, e. g. from an ATM. The term Cash Advance may also be used, typically when the funds are advanced by a merchant rather than at an ATM. Deposit: where a cardholder deposits funds to their own account (typically at an ATM). †¢ Cashback: where a cardholder withdraws funds from their own account at the same time as making a purchase. †¢ Inter-account transfer: transferring funds between linked accounts belonging to the same cardholder †¢ Payment: transferring funds to a third party account †¢ Inquiry: a transaction without financial impact, for instance balance inquiry, available funds inquiry, linked accounts inquiry, or request for a statement of recent transactions on the account. Administrative: this covers a variety of non-financial transactions including PIN change. (Source: Wikipedia. http://en. wikipedia. org/wiki/Electronic_funds_transfer. ) These types of transaction involves client to company, company to bank, then bank to bank communication to be able to complete the transaction transfers. It has been found out through studies system of electronic fund transfer transactions receive a considerable number of people who are able to appreciate the benefits of the said monetary transaction procedures (Davies, 1989, 34). The said system of fund transfer involves numerous communicating procedures between several parties. This is to verify the identity of the senders as well as the identity of the receivers for the sake of security purposes. The Benefits of EFT Looking through the view point of the senders of the monetary funds that are to be transferred, it could not be denied that there are several benefits that outline the entire EFT procedures making it more practical for investors, business enthusiasts as well as local depositors to make use of. The said benefits include the following: (a) Speed Most fund transfers that are assisted through electronic devices such as online bank connections and other transferring agents, the transfer time processing takes at least tow to three days if the location is just within the country, whereas it takes four to five working days when the transactions are to be done internationally. Either way, the procedures of the transfer in the case of EFT is far much faster than that of other mailing based transfer procedures. (b) Security  Since no actual money is going to be transferred from party to party, there would be fewer cases of funds being lost. Everything is tracked through network systems, enough reason for senders to be rest assured that what they sent would be received by the people that they are sending the funds to as it is. (c) Minimal Fees Since the speed is heightened, this particularly means that the parties involved in the transactions are minimized as well. Hence, the fees that are charged are much lowered down in rates that are most likely more acceptable to the senders of the money. (d) Transaction Order Details are Intact  It has been much necessary for this particular type of money transfer to keep everything on track. This particularly means that the transaction details are kept for repeated updating of the people who are sending the money to help them keep good track of their funds basing from the amount of monetary funds that they send out. (e) Money Managing assistance The tracking details of the systems actually encourage the clients to have an effective way of managing their money. It is through this procedure that they are able to assist their clients in controlling their use of their money. With the benefits mentioned herein, it could be observed that the EFT procedures indeed increase the capabilities of the senders and the receivers of money to control their funds through continuous and accurate tracking procedures. It is through this that the clients are well served by the banks through the integration of bank systems, electronic transfer and online connections. This is particularly the main reason why most business enterprises today choose to pay their investors and their employees through EFT procedures. They intend to give their employees bank cards that would allow them to withdraw their payments through ATM automation. The investors on the other hand receive their shares of the company profit in the same manner. At times, they give their accounts to the business financial administrators and then the funds are simply transferred to their accounts in time of cut-offs. The Governing Laws According to Roland E. Brandel’s book entitled â€Å"The Law of Electronic Fund Transfer Systems† (2005, 15), â€Å"the impending large influence of technological innovations within the economic advancements of the human society is indeed making a great change in the way the people used to view banking systems†. It is through the development of the said systems that the people already view banks to be one of the most efficient performing sectors of the human society. However, because of several security measures, the government along with the basic regulations of the banks has passed several outlines of procedures that should be used to be able to access EFT systems in a much safer way. It could not be denied that it is also through the existence of EFT’s that some computer hackers are able to access the identity of other people and worse, are able to make machinations to be able to fraudulently steal form their accounts through online connections. It is for this particular reason that the security measures have been pushed to the limits. Everything is highly being tracked especially when it comes to fund transfer procedures. According to Tan Beng Chye Dennis: â€Å"The U. S. Government monitors EFT compliance through Regulation E of the Federal Reserve Board, which implements the Electronic Funds Transfer Act (EFTA). Regulation E governs financial transactions with electronic payment services, specifically with regard to disclosure of information, consumer liability, error resolution, record retention, and receipts at electronic terminals. † This is only among the ways by which the government protects the funds of the people who are using the said transfer system. The security of the money that they send through electronic procedures is one of the primary concerns of the banks and the online financial companies that process the service. With the close observation of the procedures of the EFT system, it could be noticed that the authorization of who should only be involved in the transfer as well as with the receiving of the funds are held in direct tracking, this is particularly to address the safety of the fund and the efficiency of the service. Conclusion The modern day business procedures are indeed engaging in the band wagon of becoming highly high-tech in completing the services that they ought to give their clients as well as their employees. Through the existence of EFT systems, the business transactions of many multinational business organizations experiences ease at present. Book keeping procedures have been reduced and paper works have been gradually minimized. It could be observed that through the integration of the new technology with the procedures of helping the business companies perform their most important roles of providing funds to the society their jobs became much easier to complete. Moreover, the enhanced security of fund transfer procedures through electronic application and the integration of the law within the system give much promise to a more efficient service provided by the banks in coordination with the online financial assisting companies. True, technology has not only increased the efficient capabilities of the bank systems in transferring funds, it also eased the procedures of business transactions and assured the clients in receiving their money in a secure procedure. It could be observed that the expectation for a more complicated and comprehensive procedure in fund transferring processes in the future is indeed reasonable. The never-ending changes that happen in the banking systems are certainly to be enhanced for better service to the clients that the banks and financial companies ought to lend some service to. Indeed, the researches that are done today regarding this particular matter certainly would bring much better results for the business industries.

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