Rukmani Birla Modern High School, Jaipur

Financial Literacy

Class VII

Security

Tips to make safe and secure online transactions

1. Never save card details:

A user’s debit/credit card details must never be saved while making any kind of purchase online.

2 .Never share passwords:

Internet banking passwords must be extra strong and should never be shared with anyone. Users must also change
these regularly to avoid thefts through cyber-attacks. In case a user receives phone calls asking for password details
or ATM PIN, he/she must immediately inform the bank while making sure that no details are shared.

3.Download apps only from trusted sources:

Users should be aware that there are also many illegitimate apps available for download. These can be easily
identified by going through user reviews, statistics regarding the number of downloads, and the absence of a ‘verified’
badge.When users download applications on their smartphones, it is important to ensure that the same is verified and
legitimate. This rule applies even to mobile banking apps or mobile wallet apps.

4.Use 2-factor authentication at all times:

While making online payments, users get an option to use the secure password or ATM pin, or OTP. OTP is also
known as the One-Time Password. OTP can help to secure a digital transaction, provided it is never shared with
anyone.

5.Avoid the use of public networks or computers for digital transactions:

While making any online transactions, it is wise to avoid using public devices or Wi-Fi networks. These are prone to
cyber-attacks, thefts, and many other fraudulent activities. It is sensible to use a personal computer and always opt
for a trusted Wi-Fi source for all kinds of financial transactions.

Don’t fall prey to unknown messages or emails:

Users must always check for the email address or source of SMS before clicking or opening them. Many emails may
seem similar to what the user’s bank would generally send, however, double-checking the source is of utmost
importance.

Digital Banking

What is Digital Banking?

The Digital Banking by definition is banking done through the digital platform, doing away with all the paperwork
like cheques, pay-in slips, Demand Drafts, and so on. It means availability of all banking activities online. Digital
Banking allows us to freely access and perform all traditional banking activities 24*7 without having to personally
go to a bank branch to get our work done. Digital Banking can be done either through a laptop, tablet or your
mobile phone.
The first phase of the Digital Banking revolution was through the internet. The second phase of Digital Banking
involves mobile phone platforms. After smartphones came into the market, Digital Banking has taken off in a big
way. Smartphones now allow customers to carry out bank transactions as per their convenience.
Some of its advantages are as follows:
a. Fund transfers: Digital Banking helps to transfer funds to anyone, anytime. There are several options
available, like IMPS, RTGS, NEFT, and so on. It’s even easier to do it on the Mobile Banking App.
b. Cash withdrawal: Digital Banking allows us to withdraw cash from the ATM at any time of the day or
night.
c. Getting statements: We can use Digital Banking to download bank statements for any period at any time.
d. Paying the bills: Digital Banking has made it so much easier to pay our bills. Whether its electricity, gas,
phone or other bills, all we need to pay is via logging in. There is an auto-debit facility that allows bills
to be paid automatically as and when they arrive.
e. Stop cheques: Sometimes you may need to stop cheques for some reason – like you may have got the
amount wrong, or the beneficiary was not the one you wanted. In that case, Digital Banking makes it very
easy to stop cheques.

Common services provided by Internet banking:

NEFT
National Electronic Funds Transfer (NEFT) is a payment system that enables electronic transfer of funds from
one bank to another bank account. Money transfer can be made by an individual or company to an individual or
company's bank account with any bank that is a member of the NEFT scheme, according to the Reserve Bank of
India (RBI). There is no limit on the amount of funds that could be transferred using NEFT.

Real-Time Gross Settlement (RTGS): In the RTGS system, the money gets credited to the beneficiary’s account
on a real-time basis, i.e., instantly. The RTGS system is ideal for large-value transactions that need immediate
clearing. This mechanism is mainly used by corporates and institutions for real-time fund transfers. The minimum
amount required to be transferred under RTGS is Rs. 2 lakhs.

Immediate Payment Service (IMPS) is a payment service managed by the National Payments Corporation of
India (NPCI). This service enables individuals to make money transfer instantly through banks and RBI-
authorised Prepaid Payment Instrument Issuers (PPI) across the country. Unlike NEFT and RTGS, IMPS is
available round the clock throughout the year, even on bank holidays.
National Payments Corporation of India (NPCI): is a not-for-profit organisation building a robust,
scalable and affordable payments infrastructure for India. NPCI is an umbrella organisation for operating retail
payments and settlement systems in India. It is an initiative of Reserve Bank of India (RBI) and Indian Banks’
Association (IBA)

The Company is focused on bringing innovations in the retail payment systems through the use of technology for
achieving greater efficiency in operations and widening the reach of payment systems. The various shareholders
of NPCI include Public Sector Banks, Private Sector Banks, Foreign Banks, Regional Rural Banks, Multi State
Cooperative Banks, Payments Banks, Payments System Operators and Small Finance Banks.

Digital India and Aatmanirbhar Bharat Abhiyan :

Digital India is a flagship programme launched by India’s Government with a sole vision of the Indian economy’s
digital transformation.Digital India has various digital initiatives under its fold, some of them are as follows:

• Digital Profile of India

• Digital Profile of India o Aadhaar - Digital Identity

• Digital Governance o eTaal - Growth in e-governance transactions per day

• Digital Platforms o Aadhaar - Digital Identity o Goods and Services Tax Network (GSTN)

o Government e-Marketplace (GeM)

o Digilocker

o Unified Mobile App for New-Age Governance (UMANG)

• Digital Payments o Unified Payment Interface (UPI)

National Automated Clearing House (NACH)

Bharat Interface for Money (BHIM) Application

4.2.1. Aatmanirbhar Bharat Abhiyan:

Aatmanirbharta or self-reliance is an essential trait of a successful individual, a community, or a nation.

Aatmanirbhar Bharat Abhiyan, or Self-reliant India Mission, is the leading policy from India’s Government
towards making India a global economic powerhouse. Various features of this mission are: o Credit boost to
farmers

a. Leveraging IT for healthcare

b. Access to the public distribution system (Ration)
c. Technology-driven systems - online education

Digital Banking

Digital banking allows bank customers to avail banking services using the bank’s website or a mobile app. These
services include: • Checking account balance • Transferring funds to another account • Ordering a cheque book •
Changing passcodes, etc.

Digital Payments refers to transferring an amount of money to another individual, business or organisation
through the internet without the requirement to handle physical cash.
 Unified Payments Interface (UPI)

Unified Payments Interface (UPI) is a system that powers multiple

bank accounts into a single mobile application (of any
participating bank), merging several banking features, seamless
fund routing & merchant payments into one hood.

How is it unique?

 Immediate money transfer through mobile device round the clock 24*7 and 365 days.

 Single mobile application for accessing different bank accounts.

 Single Click 2 Factor Authentication – Aligned with the Regulatory guidelines, yet provides for a very strong
feature of seamless single click payment.

 Virtual address of the customer for Pull & Push provides for incremental security with the customer not required
to enter the details such as Card no, Account number; IFSC etc.
Quick Response Code QR Code)

What is a QR code?

A QR codes looks like this,

a. It consists of a pattern of black barcodes or squares arranged in a square grid on a white background.

b. These codes can be read through the QR code scanner. Nowadays many mobile cameras come with inbuilt
scanners.

c. They are similar to barcodes, the difference is, QR codes can store a large amount of data compared to
barcodes.

How does QR code work?

QR codes generally create a sort of pixel pattern with each part containing a piece of information. In the case of
digital payments, the information can be, merchants’ details, transaction details, etc.

Upon scanning, QR code patterns (horizontal and vertical black patterns on white background) get decoded by
the software and get converted into the character string.

The QR codes (for payment acceptance) generally carry commands related to transactions.
 Merchant can generate QR codes for his shop, or for any fixed or variable amount. According to this command,
the QR code is generated. It either opens a payment link, confirms payment, or does any other operation as
specified.

The customer just has to scan it and then transfer payment.

Bharat Interface for Money (BHIM) is an app that lets you make simple, easy and quick payment transactions
using Unified Payments Interface (UPI). You can make instant bank-to-bank payments and Pay and collect money
using just Mobile number or Virtual Payment Address (UPI ID).

The following are the features of BHIM:

 Send Money: Send money by entering Virtual Payment Address (UPI ID), Account number and QR Scan.
 Request Money: Collect money by entering Virtual Payment Address (UPI ID). Additionally through BHIM
App, one can also transfer money using Mobile No. (Mobile No should be registered with BHIM or *99# and
account should be linked).
 Scan & Pay: Pay by scanning the QR code through Scan & Pay or generate your to let others make easy payments
to you.
 Transactions: Check your transaction history and also pending UPI collect requests (if any) You can raise
complaint for the declined transactions by clicking on report issue in transactions.
 Bank Account: Switch between multiple bank accounts linked with your BHIM App. You can set/change your
UPI PIN or check your balance.
 Language: Currently BHIM is available in 20 languages, i.e., Hindi, English, Tamil, Telugu, Malayalam,
Bengali, Odia, Kannada, Gujarati, Marathi, Assamese, Bengali, Bhojpuri, Haryanvi, Marwari, Konkani,
Manipuri, Khasi, Mizo and Urdu.
 Block User: Block/Spam users who are sending you collect requests from illicit sources.
 Scan: Scan any QR code sticker that has the UPI and BHARAT QR logos on it with the BHIM app. You can also
generate your QR code to make it easier for others to pay you.
 Bill Payments on BHIM: The BHIM app supports in-app utility bill payments to help users pay bills on the go
with the help of BHIM BillPay.
 UPI AUTOPAY: You can now enable recurring e-mandates using any UPI enabled app for recurring payments
such as mobile bills, electricity bills, EMI payments, entertainment/OTT subscriptions, insurance, mutual funds
among others

National Automated Clearing House (NACH)

The National Payments Corporation of India (NPCI) offers to banks, financial institutions, Corporates and,
Government(s) a service termed as “National Automated Clearing House (NACH)” which includes both Debit
and Credit. NACH (Debit) and NACH (Credit) aims at facilitating interbank high volume, debit/ credit
transactions, which are repetitive in nature, electronically using the NPCI service.

NACH is an electronic funds transfer system that is used for transactions of a regular nature. In the case of NACH,
an account holder is able to set up instructions of a specific amount transfer to occur at regular intervals, say every
month. It is used for making bulk transactions towards the distribution of subsidies, dividends, interest, salary,
pension etc. and also for bulk transactions towards the collection of payments pertaining to telephone, electricity,
water, loans, investments in mutual funds, insurance premium etc.

Aadhaar Payments Bridge System (APBS):

APBS caters to making payments on the basis of Aadhaar number of the customers. The Aadhaar number
becomes the financial address of the customer and facilitates the movement of the customers from one bank to
another if they desire so. The APBS also sub-serves the goal of Financial Inclusion and facilitates the Government
to transfer subsidies directly to the people through their bank accounts.

NACH offers the following key advantages: Central Board of Secondary Education • Helps improve customer
relationships by creating a regular framework of payments • Reduces paper use and encourages online transactions
• Reduces the risk of delayed payments due to fixed schedule • Helpful in the payment of insurance premium,
loan instalments, credit card payments, mutual funds etc. • Distribution of government subsidies to the beneficiary
account.

Bharat Bill Payment System (BBPS)

The traditional way of paying bills amongst consumers was to visit multiple centers/ touch-points to pay their
utility and recurring bills. The consumers had to stand in long queues or visit multiple biller websites to pay their
bills. This entailed the consumer spending nearly 4-5 hours for paying various bills and also reconcile payments
made for various bills. Some of them had to create separate files to keep record of the various bills paid. The
payment of utility bills like electricity, telecom, Direct-to-Home (DTH) television, gas, water bills and other
recurring payments like taxes, loan repayments, school, college fees, etc. was a nightmare for the common person.
National Payments Corporation of India, under the guidance of Reserve Bank of India (RBI) conceptualized the
idea of having a one-stop solution for payment of all recurring bills anytime, anywhere. Bharat Bill Payment
System was launched in the year 2017, wherein consumer could pay all his/her recurring payments at one-place
via any of their preferred banking app, payment app or nearby agent/kirana shop. Consumers could now make all
their recurring payments under one roof conveniently.