3. BANKING :In general terms, the business
activity of accepting and
safeguarding money owned by other
individuals and entities, and then lending out
this money in order to earn a profit.
TERMS : The specific conditions and details of
an agreement or contract. Fixed period for
which a loan, insurance policy, or bond is
issued, a time or fixed deposit is made, or
a contract lasts.
4.
5. MICR code (pronounced my-ker) is a nine-digit
number printed on banking instruments such as
a cheque or a demand draft using a special type
of ink made of magnetic material.
The first three digits denote the city.
The fourth to sixth digits denote the bank.
while the last three digits denote the branch
number.
The code is read by a machine, minimizing the
chances of error in clearing of cheques, thereby
making funds transfer faster.
6. This code allows money to drop directly into
your bank account for payments such as
salaries and dividends.
Your tax refund will come to you faster if you
remember to mention this on the refund
form. Refunds of unwanted money in initial
public offers, too, drop back if you put down
your code on the application form.
7. It’s a fund transfer mechanism that enables
money to move from one bank to another on
a real time and gross basis.
Simply put, real time means the transaction is
settled instantly without any waiting period
and gross means that it is not bunched with
any other transaction.
8. This facility would be handy during an
emergency, when you need to transfer funds
quickly, imagine an ill child studying in
another city or a parent in an emergency
situation and needing money at once.
You would be able to use this facility if you
use Internet banking as a channel.
9. NEFT enables funds transfer from one bank to
another but works a bit differently than RTGS
since the settlement takes place in batches
rather than individually, making NEFT slower
than RTGS.
The transfer is not direct and RBI acts as the
service provider to transfer the money from
one account to another. You can transfer any
amount through NEFT, even a rupee.
10. You can use this facility if you want to
transfer funds online in a day or two.
NEFT can make life easier for those who need
to send money to their parents or children
living in another city. It cuts the trouble of
issuing a cheque or draft and posting it.
NEFT, too, can be done only through Internet
banking. Visit RBI website for a list of
branches where you will get this facility.
11. An 11-digit alphanumeric (letters and numbers)
code that helps identify bank branches.
The first four numbers represent the bank’s
code (alphabetic),
the fifth number is a control character (0), and
the next six numbers denote a bank branch. For
example, the IFSC for HDFC Bank Ltd’sKozhikode
branch in Kerala reads as HDFC0000085. This
code is mentioned on your cheque. Different
banks mention it at different places on the
cheque.
12. When sending money through RTGS or
NEFT, you need to know the IFSC of the
receiving branch.
13. It is an anti-fraud security feature that helps
verify that you are in possession of your
credit card and making the transaction.
CVV is usually a three-digit number printed
on the signature panel at the back of your
credit card
14. You need this number when shopping online
or over the phone.
You need to be careful with this number as it
can make you a victim of fraud.
It’s best to remember this number and
blacken it off from your card.
15. PAP or MCC cheques can be encashed anywhere
in India, irrespective of the city they were issued
in.
They are treated as local clearing cheques across
the country.
The amount is credited in the account the same
day and there are no inter-city collection charges
associated with a normal cheques being
encashed in another city.
A cheque issued at a branch in Chennai, can be
encashed at a branch in coimbatore as if it were a
local cheque.
16. Issuing a PAP or MCC cheque, you can save
demand draft or cheque clearing costs.
Usually, these cheques are issued by
companies to disburse dividends or
redemption amounts.
17. It is the structured transmission of data between
organizations by electronic means, which is used
to transfer electronic documents or business data
from one computer system to another computer
system, i.e. from one trading partner to another
trading partner without human intervention.
It is more than mere e-mail; for
instance, organizations might replace bills of
lading and even cheques with appropriate EDI
messages.
It also refers specifically to a family of standards.
18. The UN-recommended UN/EDIFACT is the
only international standard and is
predominant outside of North America.
The US standard ANSI ASC X12 (X12) is
predominant in North America.
The TRADACOMS standard developed by the
ANA (Article Numbering Association now
known as GS1) is predominant in the UK retail
industry.
The ODETTE standard used within the
European automotive industry
19. Its scheme provides an alternative method of effecting
bulk payment transactions like periodic (monthly/
quarterly/ half-yearly/ yearly) payments of interest/
salary/ pension/ commission/ dividend/ refund by
Banks/Companies /Corporations /Government
Departments.
The transactions under this scheme move from a single
User source (i.e. Banks/Companies /Corporations
/Government Departments) to a large number of
Destination Account Holders (Customers/Investors).
This scheme obviates the need for issuing and handling
paper instruments and thereby facilitates improved
customer service by the Banks and
Companies/Corporations/Government Departments
effecting bulk payments
20. The Scheme is in operation at 15 centres
where Reserve Bank of India manages
Clearing Houses, 21 centres where SBI is
managing ECS on behalf of RBI and 29 other
centres where
PNB and other banks are managing ECS on
behalf of RBI
21. It is the electronic exchange, transfer of
money from one account to another, either
within a single financial institution or across
multiple institutions, through computer-
based systems.
22. Wire transfer via an international banking network
Cardholder-initiated transactions, using a payment
card such as a credit or debit card
Direct deposit payment initiated by the payer
Direct debit payments, sometimes called electronic
checks, for which a business debits the consumer's
bank accounts for payment for goods or services
Electronic bill payment in online banking, which may
be delivered by EFT or paper check
Transactions involving stored value of electronic
money, possibly in a private currency
23. It is the communication backbone for the Indian
Banking and Financial Sector.
All banks in the public sector, private sector,
cooperative, etc., and the premier financial
institutions in the country are eligible to become
members of the INFINET.
The INFINET is a Closed User Group Network for
the exclusive use of member banks and financial
institutions and is the communication backbone
for the National Payments System, which caters
mainly to inter-bank applications like RTGS,
Delivery Vs Payment , Government Transactions,
Automatic Clearing House, etc
24. Its facilitate the exchange of government
securities and other money market
instruments.
The negotiated dealing system will also be
responsible for hosting new issues of
government securities.
25. The negotiated dealing system helps the RBI
enhance the dealings of fixed income
investments.
The NDS, when fully implemented, eliminate
the physical exchange of forms between its
trading members
26. Its secure messaging standard developed to serve as
a platform for intra-bank and inter-bank
applications.
It is an Indian standard similar to SWIFT (Society for
World-wide Interbank Financial Telecommunications)
which is the international messaging system used for
financial messaging globally.
SFMS can be used practically for all purposes of
secure communication within the bank and between
banks.
The SFMS was launched on December 14, 2001 .
it is a modularized and web enabled software, with a
flexible architecture facilitating centralized or
distributed deployment.
27. Its another area of application of the INFINET
The CFMS enables banks to obtain
consolidated and account wise, center wise
position of current accounts with different
Deposit Accounts Department (DADs) of RBI
It is Centralized Funds Enquiry System (CFES)
that is based on the current and other
accounts maintained at the different DADs
This mechanism allows for the dissemination
of information online as regards the bank’s
28. Overall current account balance with the RBI.
It makes avilable centralized facility where
banks could obtain the latest consolidated,
center-wise and account wise position of
their balances with RBI.
This allows for the optimum use of the funds
of the bank and to make alternate
arrangements to obtain funds at competitive
rates.
29. It also called electronic bill payment and
presentment.
It is a form of electronic billing in which a
company presents (sends) its bills and customers
pay these electronically over the Internet.
Certain electronic billing applications also
provide the ability to electronically settle
payment for goods or services.
Customers of banks and billing companies can
use the internet or the phone to conveniently
remit payments as well as access their billing
information.
30. The service is also supported by customer
service representatives (CSRs) contacted
directly by the consumer to facilitate
payments or receive general assistance and
answer questions.
It can produce substantial savings to
traditional print & mail billing and payment
remittance, and as an added benefit is a
significant reduction in the use of paper
31. Its form of the Electronic banking that
enables the user to communicate interactively
with the bank.
For this communication the client uses only
GSM mobile phone with WAP service. With its
options and the method of controlling WAP
banking reminds an easy form of Internet
banking.
32. It is a computerized telecommunications
device that enables the clients of a financial
institution to perform financial transactions
without the need for a cashier, human clerk
or bank teller.
ATMs are known by various other names
including ATM machine, automated banking
machine, "cash machine" (Geldautomat -
Germany) and various regional variants
derived from trademarks on ATM systems
held by particular banks
33. On most modern ATMs, the customer is
identified by inserting a plastic ATM card with a
magnetic stripe or a plastic smart card with a
chip that contains a unique card number and
some security information such as an expiration
date or CVVC (CVV).
Authentication is provided by the customer
entering a personal identification number (PIN).
Using an ATM, customers can access their bank
accounts in order to make cash
withdrawals, debit card cash advances, and check
their account balances as well as purchase pre-
paid mobile phone credit
34. PUBLIC DEBT OFFICE, in the U.S., is a part of
the Department of Treasury and is
responsible for the issuance, control, and
payment of government issued securities in
compliance to existing regulations.
35. This Directive aims to reduce the systemic risk inherent in
payment and securities settlement systems and to minimise
the disruption caused by the insolvency of a participant in
such a system.
The Directive aims to reduce the systemic risk associated with
participation in payment and securities settlement systems
("systems"), and in particular the risk linked to the insolvency
of a participant in such a system. To this end, it lays down
common rules stipulating that:
36. Transfer orders and netting must be legally
enforceable;
Transfer orders may not be revoked once
they have been entered into the system;
The insolvency of a participant may not have
retroactive effects;
The insolvency law applicable is the law of the
Member State whose system is involved.
37. AUTOMATED VOICE RESPONSE (AVR )
According to Automated Voice Response
technology, a customer uses the tone-phone to
send ‘digitized data messages’ to the system in
order to activate a particular service.
The customer is then ‘prompted’ by the
service to provide one or more type of
instruction.
Sometimes, the technology also requires the
customer to say one of a number of particular
words down the telephone.
