How many payment methods do you know?
Can you name more than three different ways that money can be transferred? Right this way, we'll fill you in.
Have you noticed that credit cards have mostly replaced cash as the preferred method of payment in today's retail establishments? Alternate payment methods are now accepted. Could you benefit from learning about the various approaches that can be taken?
You should be aware that cash is slowly disappearing from fashion due to technological advancements, just as barter, the initial form of payment, fell out of favor hundreds or even thousands of years ago.
Multiple payment methods exist today, but they all operate on the same fundamental principle: the exchange of one currency for another. Come along with us as we investigate their nature.
This is the oldest form of payment that exists after barter. Cash is money in the form of coins and bills used to make payments for products or services. It is the money we carry with us, whether in a wallet, purse, or pants pocket. The coronavirus pandemic has caused the use of this means of payment to decrease due to the fear of possible contagion from touching coins and bills.
Debit and credit cards
Along with cash, card payment is another of the most widely used means of payment. The advantage of paying by card is that you do not charge cash, but the bank pays the person or company from whom you bought the product using a transfer. In addition, there are several types of payment cards. The most common are credit cards, which work using a loan that the bank makes to you so that you can buy in installments or with cash. The other is the payroll card, which contains the salary paid to your parents, and every time they make purchases, they subtract the amount they spend.
Although it is a means of payment that is still unknown to many people, its operation is very simple, since we simply have to scan the QR code that is in the form of a small square that has a business through our cell phone. By scanning the code, you send the signal to the bank, which makes the payment immediately. To use it, you need to have a virtual wallet installed on your device.
Bank transfers and direct debits
A bank transfer is the transfer of money from one bank account to another. It is a financial transaction through which a person instructs his or her bank or financial institution to send a certain amount of money from his or her account to the account of another person or company. Direct debit is the standing order you give to a bank to charge you each month for the payment of bills, be they for electricity, cable TV, water, gas, etc.
Payment through applications (apps)
During the last few years, applications and digital services have emerged that allow us to send money through our mobile devices instantly and without having to go to the bank. You only need to download the application from the financial institution where you have the account.
An online payment system transfers money between the buyer and seller in an online transaction at a lower cost and in less time.
This form of payment is rarely used anymore. But it is how a person authorizes, with his signature on a certificate or check, the payment to the bearer of a certain amount of cash in the bank where he has an account.
Cryptocurrencies are a means of payment with virtual money (they do not exist physically). They can be used for the purchase and sale of goods and services, although at the moment few businesses accept them. You should know that in our country, cryptocurrencies are not regulated or supported by financial authorities.