Market Research Introduction 2 Cash-based Payment Systems and Electronic-based Payment Systems
Added on 2021-04-21
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Market Research
Table of ContentsIntroduction...........................................................................................................................................2Literature review...................................................................................................................................2Cash-based payment systems and electronic-based payment systems...............................................2Advantages and disadvantages of cash-based payment systems and electronic-based payment systems..............................................................................................................................................3Implementation of E-system..............................................................................................................4Key indicators that inform to bring change in any country................................................................6Research proposal..................................................................................................................................7Methodology.........................................................................................................................................7Research philosophy..........................................................................................................................7Research approach.............................................................................................................................8Research design.................................................................................................................................8Working data type.............................................................................................................................8Sampling............................................................................................................................................9Research ethics..................................................................................................................................9Gantt chart.......................................................................................................................................10Survey.................................................................................................................................................11Data analysis.......................................................................................................................................11Limitations..........................................................................................................................................19References...........................................................................................................................................201
Introduction The world is moving rapidly towards the electronic-based payment systems from the cash-based payment systems. There are many reasons for the non-acceptance of cash but peoplestill like the cash-based world. The development of a cashless world is being shaped by manylocal factors. Cash transaction accounts for 85% of the total consumer transactions in theworld. The world is gaining access to multiple non-cash options to make payments. There aremany countries that have focused on moving towards the cashless society (Batiz-Lazo, Haigh& Stearns, 2011). The share of noncash payments of the total value of payments in Belgiumis 93%. The percentage of the population using a debit card is 86%. The share of noncashpayments of the total value of payments in France is 92%. The percentage of the populationusing a debit card is 69%. The share of noncash payments of the total value of payments inCanada is 90%. The percentage of the population using a debit card is 88%. The share ofnoncash payments of the total value of payments in the United Kingdom is 89%. Thepercentage of the population using a debit card is 88%. The share of noncash payments of thetotal value of payments in Sweden is 89%. The percentage of the population using a debitcard is 96%. The share of noncash payments of the total value of payments in Australia is86%. The percentage of the population using a debit card is 79%. The share of noncashpayments of the total value of payments in The Netherlands is 85%. The percentage of thepopulation using a debit card is 98% (Ray, 2015). The countries are pushing people to usedigital payments systems and developing digital infrastructure. The main objective of thegovernment is to decrease costs by increasing profitability. The service application has beenintroduced which allows the managers of the financial institutions to control and monitordirectly interactions with the customers. The financial institutions are instructed to focus ondigital banking and the payment organizations have to enhance the quality of their services.The financial institutions are putting efforts for increasing the convenience and services atATMs, branches and cash. The government of many nations are decreasing the dependenceof the people on the cash transactions and adopting the digital payment techniques. Literature review Cash-based payment systems and electronic-based payment systemsThe cash-based payment system is an instant payment of cash for any product or service. Itis a fast and convenient way where the provider receives the payment immediately at the2
point of the sale itself (Cateora, 2005). Cash-based payment is a cheaper option fortransactions. There are multiple vendors who provide a discount on cash payments forpurchasing any product or service. Electronic funds transfer at point of sale is a system which allows making payments or fundstransfers using the debit or credit card. This technology firstly used in 1981 in the UnitedStates and then it reached Australia and New Zealand. EFTPOS is an electronic device whichhelps in making fund transfers to merchant's bank account from the customer's bank account.And it only accepts debit or a credit card. EFTPOS can only be used for the business basedtransaction. There are some criteria to get access to this device, an applicant has to apply forthe membership and it must be a company(Jain & Kailay, 2018). Advantages and disadvantages of cash-based payment systems and electronic-basedpayment systemsThe electronic mode of payments cost the merchants, usually 3% of the total cost of thetransaction. Merchant passes this charge onto to the buyer, which make electronic paymentscostly than cash payments. Cash payments also reduce the risk of any type of fraud oridentity theft. Credit card information can be stolen very easily by the fraudster using askimming device or a wireless card reader (Upadhyay & Chattopadhyay, 2015). The onlinebanking credentials can also be hacked and sold which can destroy the privacy of the accountholder. Cash payment helps to maintain a budget. It is found that people spend less when theyare using cash for purchasing. A person, who is carrying cash, cannot purchase somethingwhich is out of his/her budget or he/she cannot afford at that moment. In the other hand creditcard provide an option to buy now and pay later option.On the other hand, cash is very hard and risky to carry. It is highly possible to get noticed andstolen by a thief. It also takes more time to go to the bank or an ATM to withdraw it thanusing a card which already available in the wallet. Cash payment puts a cap on spending butin an emergency situation, it could be a trouble. Online shopping has become very popularand they receive payments online which can be a problem for those who use cash only for thepayments. In some countries people are not allowed to carry a large amount of cash, it is acriminal activity (Churchill & Brown, 2009). EFTPOS reduce the labour cost as the money directly goes to the bank account so there is nocost of maintaining cash reports or receipts. It is a faster and convenient system in processingpayments. This saves a lot of time for the merchant and the customer. It also generates a3
receipt which is helpful in case of dispute. It is unable an option to dispute a charge in casethe merchant is refusing to refund the amount which not seems legitimate charge to thecustomer. EFTPOS system is very convenient it helps to avoid carrying a large amount ofcash. Debit and credit cards are being used to make payments for purchasing any service orproduct (Dugar, Shreshtha & Jain, 2014). It is also expending the purchasing power. It allowsmaking large purchases and the payments are getting broken down in different instalments. Ahuge amount of cash can be noticed and stolen very easily. An organization that keeps a hugeamount of cash as a stock can be easily targeted by the robbers. EFTPOS system reduces therisk of theft as the money directly goes to the bank account. And all the transactions which gothrough this device are absolutely safe. There is a safety feature enable in this device whichnot only tracks all the transactions but also block fraud transactions. EFTPOS has broughtrevolution in the payment system and the whole world is adopting this to make a cashlesssociety. There is a huge challenge for the organizations to provide EFTPOS facility to thecustomers in order to do business with them. Customers are not carrying cash any more,cards are being used to make payments and the origination has to accept all the cards in orderto do business. It is a convenient option for the customers, as they do not require carrying alarge amount of cash to make a payment (Johnson, Kiser, Washington & Torres, 2018).A payment through EFTPOS charges the merchant. Whenever a customer pay using the debitor credit card for any purchase there is a service fee which generally bears by the merchant.EFTPOS payment generates receipt automatically and keeps records for every transactionwhich may hamper some customer’s privacy. Since it is a 21 century’s technology, it requireselectricity to process any transaction and sometimes accesses to mobile networks as well, soin ruler areas, it may not work (Papadopoulos, 2007). Implementation of E-systemThe government plays a significant role in any country in bringing significant changes. Thegovernment should focus on the technologies by increasing online facilities for the citizens inorder to support the implementation of the electronic based payment systems. Thegovernment with the help of financial institutions and other organizations would be able tomove towards the cashless system for decreasing costs and increasing efficiency. The internetfacilities need to be available for 24*7 in order to support the transaction process (Szmigin &Foxall, 1999). The electronic based payment systems are being controlled by the banks whichmean they are very much important for managing the whole process. The electronic paymentscan be done through electronic banking and electronic cards. Thus, the infrastructure needs to4
be developed focusing on implementation of transaction systems for the convenience of thepeople. The electronic payment systems should be available in each store of the market.The government of the country should ensure that there should be no system failure and ifoccurs then there should organizations who would be responsible to manage the situation.The main focus would be that the citizens should not face any kind of problem while theycarry out their payment process. The use of plastic cards (credit and debit cards), SMSpayment, internet banking, virtual currency, a virtual wallet and electronic cards should beencouraged among people of the country. The technological revolution in the field ofcommunication and information has supported the improvement and development of cashlessinstruments and applications for both organizations and individuals (Wakamori & Welte,2017). The investment should be made in the development of 3G/4G networks, QR code,NFC, smartphones and Wi-Fi in order to speed up the flow of data and information. The flowof information is safer, easier and faster which enhances the productivity of the nation. The e-transfer infrastructure needs to be more efficient in order to avoid any kind of problem thatmay arise during the whole process. The availability of competitive marketplace, dynamicbusiness environment and affordable products are significant factors for the implementationof the electronic based payment system within the nation. The role of government will not be limited to only individuals but also applicable to society,family and the entire and nation. The government has to identify the basic needs of thecitizens which will help to implement the e-systems within the nation. Banking is consideredto be the backbone of the economy and it acts as a bridge between organizations andcustomers. The banking system is being dependent on human skills and knowledge forcarrying basic functions such as posting, journal, ledger and trial balance creation. Thebanking system needs to be very efficient and advanced for ensuring smooth functioning ofthe process (Worthington, 1995). The citizens need to be provided with adequate knowledgeabout the use of the electronic based payment system and its benefits. The digital transactionswill assist to solve many problems of the citizens in the country. The transfer of money andelectronic exchange can be carried out with the assistance of electronic devices such as cards,computers and phone. Thus, the government can invest into the economy for developinginfrastructure (Borzekowski & Kiser, 2008). 5
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