The Application of Prepaid Cash Cards on Consumers

Prepaid cash cards look like credit and debit cards and they offer the same ability to purchase products and services but with a crucial difference whereby the consumers can only use up the balance in the prepaid cash cards. This means there is no risk of running into debt as it has no credit or overdraft facility.

In Malaysia, there are many types of prepaid cash cards exist. For example Public Bank Debit Card, Maybank Visa Debit Card, Touch n Go Card and others.

Other than this, there is another famous prepaid cash card called “Octopus Card” which has been dominating Hong Kong’s contactless smart card segment since it launch. Presently, the Octopus Card can be used in virtually all of Hong Kong's transportation systems including the MTR (railway lines), public buses, mini-buses, trams and shuttles. In addition, the Octopus Card can also be used in fast food outlets, bakeries, convenience stores, supermarkets, cinemas, etc., and is widely accepted in over 5,000 vending machines and kiosks and over 160 car parks and 18,000 parking meters within the territory.

Prepaid debit cards carry the Visa or MasterCard logo and are accepted worldwide as with normal credit cards. These cards are a good option for those with insufficient credit history or impaired credit because they do not require a credit bureau check to be approved. The traditional un-banked populations in the United States have proven to be a tremendous growth area for these products and should continue to fuel growth over the next decade.

Applications:

• Pay Bills – Consumers can pay the mobile phone bill, electricity & water bill, rent, student bill, insurance, loan and other bills.

• Shopping – Just pay by Visa or Master debit card to bring back your loving goods.

• Transfer or Withdraw Money – Get cash at ATMs, at any place and time.

• Pay for Toll – Using Touch n Go Card for paying highway toll and majority public transportation in Malaysia such as LRT, Putra Line, and Bus

• Booking – Get hotels, air tickets or movie tickets done by prepaid cash cards

Advantages:

• Availability - there are no credit checks, which means you can get a card without worrying about your credit history. All prepaid card providers will carry out an identity check to confirm you are who you say you are.

• Control - prepaid cards are an ideal way to budget for yourself or help to manage your children's spending. Like a credit card you get a full breakdown of spending on the card so you can see what has been purchased, who from and when.

• No debt risk - with a prepaid card there is no chance of spending too much as you are limited to the amount you put on your card.

• The card for travel – prepaid cards are a good option if you are going overseas.

• Convenient - Prepaid credit cards can be used everywhere Visa or MasterCard is accepted

Credit Card Debt: Causes and Prevention

Credit card has become a necessity in one’s life nowadays. Undoubtedly, it has given a lot of conveniences to its users. However, in certain circumstances, it creates irritations. Put aside credit card fraud which is a serious crime, the credit card debt has become a severe issue and it is the major cause of bankruptcies each year.

The causes of credit card debts:

Unemployment
It so happens that the main breadwinner of the household loses his job but monthly expenses are not cut down in line with the reduction in income. This obviously leads to a rise in debt. The family is forced to use their credit cards for groceries, utilities, etc.

Poor Money Management
Poor money management is one of the best reasons why so many families accumulate lots of debt. Not having a monthly spending plan and not keeping track of the monthly bills makes one unaware of where the money is going. While the money is going towards purchasing useless items, he might need charging the necessary purchases on credit card.

Gambling
Most people hope to win the lottery but the chances of that happening are almost 0%. Do not spend tomorrow's saved money today just because one expects a promotion in his job or is expecting an inheritance from a deceased grandfather. We all know life is unfair and things can go wrong more easily than going right.

Big medical expenses
The cost of obtaining cures and medicine is increasing every year. Nowadays, almost every hospital and doctor accept credit cards. While one needs treatment but do not have sufficient cash or savings in the bank, credit card will be used. Here, a huge debt may be created.

Financial Ignorance
Important topics such as saving and investing one’s personal finances are not taught in school. People who are lack of such knowledge may easily become the next victim of credit card debt.

Followings are some of the method to prevent credit card debts:

Manage your finances
The first step in managing the finance is determining your monthly income and needed expenses. As part of these monthly expenses, figure in 5-10% of your income to set aside for emergencies, long range savings such as a retirement account, and short term savings.

Shop for the Right Card
It’s important to really shop around and get a credit card personalized for your particular situation. It is ideally suggested that getting one with no or very low fees and low interest. It will take a little time to compare various offers, but with the high saturation of the market you’ll find the perfect fit for your wallet.

Pay on Time
Never make a late payment to anyone including car and house payments. Because of the universal default clause in credit cards’ terms and conditions, credit card companies can raise your interest rate if you are late paying any creditor or even your utility company.

Pay the Balance in Full
This is important in keeping control of your credit cards. Before using a credit card for a purchase, ask yourself, “Do I have the funds to pay for this?” In cases of emergencies where your emergency fund won’t cover the whole amount you need to charge, experts say at least pay more than the required minimum payment.

Early Education
The best method for prevention is teaching your younger generation all about money before they even qualify for a credit card. Statistics show that students are entering college without ever having a personal finance class or knowing how to balance a checkbook. Yet once students arrive on campus credit card issuers are eager to sign them up. College students are racking up the bills.

The main prevention is aware of the causes of credit card debts and starts to spend less in order to stay in well financial situation.

Related links:
http://www.credit-land.com/articles/articles_page_68600_1881780_120.php
http://ezinearticles.com/?Credit-Card-Debt---Prevention-Is-Better-Than-Cure&id=226244

Electronic Currency

What is electronic currency?

Electronic currency refers to money or scrip which is exchanged only electronically or a system of debits and credits, used (but not limited to this) to exchange value, within another system, or itself as a stand alone system, online or offline.Basically, this involves use of computer networks, the internet and digital stored value systems, for instance, the Electronic Funds Transfer (EFT) and direct deposit. As addition, it is a collective term for financial cryptography and technologies enabling it.

E-currency is use in the E-micropayment systems such as Firstgate’s Click and Buy, PayLoadz,Paystone Technologies, DigiCash and else.Now, let us look at PayLoadz in detail. Payloadz is a service to sell intangible products such as softwares, e-books, digital art, manuals, articles and files. It is an automated delivery service which means these files can be either download via hyperlink or sent via e-mail to consumers once payment is being made. Payloadz also has an easy integration with PayPal’s online payment and Google Check out.

If you want to sale digital PDF files, Payloadz is your best choice. Once your customers download the intangible, and the money flows into your PayPal account. Payloadz services can be used depending upon seller’s sales and product’s life size. The plan include 3 types of account which is Basic Account with 50 MB storage, Premium Account with 100MB-400MB and Corporate Account with 800MB-100000MB.You may go to link http://www.payloadz.com/ to register on payloadz.Furthering network evolution in terms of the use of digital cash, a company named

DigiCash is at the focus of creating an e-cash system that would allow issuers to sell electronic coins at some value. When they are purchased they come under someone’s own name and are stored on his computer or under his online identity. At all times, the e-cash is linked to the e-cash company and all transactions go through it, so the e-cash company secures anything that is purchased. Only the company knows your information and will properly direct purchases to your location.

Related links:

https://www.paypal.com/my/cgi-bin/webscr?cmd=_home-general&nav=0

http://www.digicash.com/

Mobile Payment Systems in Malaysia

Mobile Payment Systems in Malaysia: Its Potentials and Consumers’ adoption Strategies









Mobile payment is defined as a point of sale payment made through mobile devices such as mobile phone, Smartphone, Personal Digital Assistant (PDA). It is a rapidly-adopting alternative and latest payment method especially in Europe and Asia.

TeleMoney, our country’s first mobile payment service via multi-channel access for Internet and wireless transactions which was launched on the last quarter of 2001, and it was expected to fully operational in the first quarter of 2002. It is a service free of banks and telco dependence where a customer with a credit card or debit card with a cellular phone can register for this service. They can use their mobile phones to pay for a wide range of services and digital goods such as ringtones, videos, books, magazines, and transportation fare after registered to those particular services instead of paying with cash, cheques or credit cards.

Mobile Money (MM Wallet) is a PIN-based Mobile Payment Solution which allows registered users to pay for goods and services at anytime from anywhere by using only a mobile phone coupled with a 6-digit security PIN (Personal Identification Number) via SMS (Short Message Service). It also allows one to receive money from anyone, from anywhere, at anytime. Shoppers are allowed to purchase the goods online and pay the merchants using their mobile phones without being physically present at the store. At the same time, it allows merchants to take online order without the need for online shopper to disclose their credit card information.


On the other hand, the world’s first contactless mobile payment service which is called as Near Field Communications (NFC) technology drives service has been launched on the first quarter of 2009 in Malaysia. Near Field Communications (NFC) is a short-range wireless technology that allows communications between devices at close range. NFC is a new and open platform technology which offers high levels of interoperability between devices and readers that allows credit card, debit card, ticketing and transportation payments to be integrated into mobile phone.


Potentials of mobile payment systems:
a) It enables the ability to pay for goods and services without having to carry cash or cards during the transactions.
b) A large number of mobile device users can be increased since it offers a unique opportunity to open up the financial system to more customers and communities, in order to achieve financial inclusion for all segments of our society.
c) It assures the safety of data for the customer where the payment is secured by a strong pin fraud protection patent which offers great security and inability of hacking passwords.


Consumers’ adoption strategies:
a) Payments are far easier and less costly to handle than cash itself including other traditional payment methods. Therefore, users can have a complete trail of all payments they make - unlike cash.
b) Collaborate with more banks and companies to widen the ability to pay via mobile at the same time it helps to increased customer’s satisfaction and confidence.
c) Consumers are being educated about the mobile payments and the way to use it such as bill payments by using GPRS and WAP


Related Link:
http://www.zdnetasia.com/news/communications/0,39044192,39001884,00.htm
http://www.neowave.com.my/mobilemoney_overview.asp
http://www.mis-asia.com/news/articles/worlds-first-contactless-mobile-payment-system-launches-in-malaysia