Electronic payment system is the means of paying for goods and services without checks or cash, it is also called an online payment system. The electronic payment system has grown dramatically over the last few decades thanks to the use of the Internet and the general shopping experience. As a leading global technology developer, electronic payments and payment instruments have been set up to improve and protect ABB’s payment transactions while reducing the percentage of checks and balances of cash. This essay will be focused on the advantages and disadvantages of E-payments along with the effects of E-payment on environment and business.
2.0 Effects of Electronic payment system (E-Payment) on the environment and business
2.1. The effect on the environment
The progressively serious air pollution phenomenon and global warming problem has stimulated different industries to explore relevant sustainable practices that could reduce the carbon emission. Ramila and Gurusamy introduced a concept of banking industry, named green banking. One of the products of green banking is the E-payment system, the usage of which can reduce the carbon footprint levels efficiently. There is a study can confirmed that E-payment systems adapted by bank contribute to the large extent reduce the emission of carbon. The most environmental friendly method is the utilization of credit cards and debit cards.
2.2. The effect on business
Disadvantages of electronic payment affect its sustainable development in the long term. Miroslav and Andon show four assessment standards of an electronic payment, these criteria can measure the sustainable level of a system. In the technological area, the designer need to meet the customer demand, the system has to ensure the safety and efficiency of the transaction. For example, the security of transaction includes many aspects, the security of depositing and withdrawing money, the security of customers’ private information and database, the security of Internet and business, and the security of maintenance and management. All of these security issues require technical support. In the electronic commerce area, E-payment acts as a method for transactions, businesses and customers have consider the cost. The cost of the transaction, exchange, user range, value mobility and financial risks, these factors need to be taken into consideration. In the social area, mainly concerns about social need, protecting the privacy of the customer, the degree of acceptability and mobility. In the institution and law aspects, the payment system has to keep the law and regulations, or the respective policies of the district and country. If the electronic payment wants to develop sustainably, the companies have to think about how to reach the above four standards. This essay will give some recommendations about systems. Firstly, improving the standard of credit card application, shortening the time limit for credit card repayment, decreasing revolving debt. DeVries and Peter point that U.S consumers currently hold $880 billion in revolving debt, with a mean household credit card balancing of approximately $6,000. Credit card abuse may threaten the stability of financial environment; E-payment system should set limits on overusing of a credit card. Secondly, the marked development of Internet technologies has witnessed an increasing amount of cyber fraud. not just in the United States, every year billions of Euros are lost worldwide due to credit card fraud (DeVries &Peter 2017). The banking industry and financial institutions should conduct strict supervision, the system should be equipped with advanced fraud detection techniques.
3.0. Advantages and disadvantages of the Electronic payment system
3.1. Advantages of Electronic payment system (E-payment)
The extensive use of electronic payments has arisen for a number of reasons. First, it can increase the efficiency of the company. According to Lux and John in the mobile industry, sales have surged four times when credit cards were accepted. Additionally, telecommunications companies can spend more time with real sales than replenishing full paper credit cards. In the banking sector, Andrea and Dociu insisted that e-payments provide a better deal, customers pay an annual fee and additional electronic payments instead of checks. In the past, almost all bank services were billed. Electronic payment not only promotes corporate development but also brings people’s daily convenience to life. It is simple and safe without money and controls and can be used abroad. As Lux and John argue that e-payments provide customers with more options when shopping online, for example, they can sell things to existing ones. Electronic payments can also provide billing services, customers just call 900 and inform service staff for information and pricing.
3.2 Disadvantages of Electronic payment system (E-payment)
E-payment has many shortcomings that cannot be ignored. Since they lack relevant technology to utilize in a universal mode of payment, companies need to spend a large amount of money in outsourcing relevant payment transactions to professional agencies. Such a large cost seriously affects the profitability of a business. Furthermore, in order to maintain the sustainability of E-payment, mobile companies and banks need to invest huge amounts in development and research departments. Finally, Rashmi and Junkang highlights that internet hackers are becoming increasingly rampant, any negligence about the security of companies can cause public confidence to collapse overnight. For customers, mobile devices are easily to be stolen and E-payment systems are being accessed unauthorized. Another threat to the interest of customers is cyber fraud. In the article of DeVries and Peter, a report in the 14th Annual Online Fraud Report in 2013 states that the amount of fraud keeping rapidly increasing with the worldwide of online sales. The reason is that merchants attempt to reduce the cost of productions and expenses of operations by reducing the pursuit of product quality, and also continue to build their public trust in customers.
4.0. Limitation of the Study
The limitation of the study is the availability of the proper sources to analyse the effects of the electronic payment system. Though there are some limitation to the use of the electronic payment system but the advantages of it is very huge.
And it is recommended that the study could be analysed with proper example and the application of this system should be secured at high response.
This essay has briefly illustrated electronic payments, listed their advantages and advantages, and then demonstrated their effects on the sustainable development of the environment and the business. Electronic payment is like a double-edged sword because it benefits customers by promoting simpler and faster transactions, but it may have negative consequences for the insecurity of capital and information leakage. As an important step on the way forward to cashless transactions, government, businesses need to do more research to establish a more secure payment system.
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