27-12-2012, 04:54 PM
E-CHEQUES
E-CHEQUES.ppt (Size: 1.47 MB / Downloads: 28)
What is E-cheques?
E-cheques are a mode of electronic payments.
E-cheques work the same way as paper cheques and are a legally binding promise to pay.
History of E-cheques
This technology was developed couple of years ago by a consortium of Silicon valley IT researchers and merchant bankers and since then has been promoted by many of the financial bodies.
Working of E-cheques
E-cheques work the same way as paper cheques and are a legally binding promise to pay. The payment system uses digitally signed XML documents that provide mechanism to authenticate parties to a transaction. E-cheques are defined using FSML (financial services markup langauge) which allows for addition and deletion of document blocks, signing, co-signing, endorsing, etc. Signatures are accompanied by bank-issued certificates which tie the signer's key to a bank account.
Standards of E-cheques
Different accounts are used for e-cheques to protect standard chequing account against fraud. Settlement is handled via existing standards - ANSI X9.46 with FSML representation instead of cheque image and ANSI X9.37 cash letter contained in X9.46 encapsulation.
Advantages of E-cheques
It seems that consumers would gain from having E-cheques available to make payments for online purchases. The online merchants on the other hand could receive payments instantly and since the customer’s bank will be involved in the transaction.
It would be impossible for an E-cheques to bounce.
Banks can do paperless, efficient transactions.
Disadvantage of E-cheques
The problems come when your merchant does not accept E-cheques.
The other problem could be when you have more than one signer or endorser.