Page 221 - DMGT303_BANKING_AND_INSURANCE

Banking and Insurance

Notes
11.18 Money Market Mutual Funds
11.19 Summary

11.20 Keywords
11.21 Review Questions
11.22 Further Readings

Objectives

After studying this unit, you should be able to:
 Understand the ins and outs of E-banking and Electronic Clearing Service (ECS).
 Explain what is Electronic Funds Transfer (EFT)?
 Explain an analysis of various banking cards - Credit cards, Debit cards and other cards.

 Know Tele-banking
Introduction

Electronic banking, also known as electronic funds transfer (EFT), is simply the use of electronic
means to transfer funds directly from one account to another, rather than by check or cash. You
can use electronic funds transfer to:
 have your paycheck deposited directly into your bank or credit union checking account.
 withdraw money from your checking account from an ATM machine with a personal
identification number (PIN), at your convenience, day or night.
 instruct your bank or credit union to automatically pay certain monthly bills from your
account, such as your auto loan or your mortgage payment.
 have the bank or credit union transfer funds each month from your checking account to
your mutual fund account.

 have your government social security benefits check or your tax refund deposited directly
into your checking account.
 buy groceries, gasoline and other purchases at the point-of-sale, using a check card rather
than cash, credit or a personal check.
 use a smart card with a prepaid amount of money embedded in it for use instead of cash at
a pay phone, expressway road toll, or on college campuses at the library's photocopy
machine or bookstores.
 use your computer and personal finance software to coordinate your total personal financial
management process, integrating data and activities related to your income, spending,
saving, investing, record keeping, bill-paying and taxes, along with basic financial analysis
and decision making.

11.1 Electronic Banking or E-Banking

The following terms refer to one form or other of electronic banking: personal computer (PC)
banking, Internet banking, virtual banking, online banking, home banking, remote electronic
banking, and phone banking. Electronic banking is an umbrella term for the process by which

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