The application of pre-paid cash card for consumers.

What is Pre-paid cash card?

Pre-paid cash card is a rechargeable stored value card that can be used to transfer electronic payments in online or offline system. The amount to be paid will be deducted from the value. Once the initial value has been completely used up, user can top up and continue using it to make transaction. With a pre-paid cash card, we can have faster journey and we do not need to carry so much cash with us all the time. With just a card we can go anywhere we want. It is so convenient and safe.

Prepaid Cash Cards – Why people use them?

Nowadays, people can limit their spending with their prepaid cash card that load funds onto the card and use the money. There are many people tend or already have their own prepaid cash cards, why is it so? The several reasons are as below:

1. Remain in control of one’s money, keep track all of activity online or by phone.

2. Free balance alerts –Some card providers will inform users on how much cash they have.

3. Eliminate check cashing fees and enjoy immediate access to your money through direct deposit of your paycheck, government payment or other income sources, no bank account needed.

4. Avoid bounced check fees; always know exactly how much money you have to spend. The prepaid card can help protect you from over spending.

Examples of Pre-paid cash card

Touch ‘n Go (TnG) smart card is an electronic payment system that can be used by Malaysian at all highways, major public transport in Klang Valley, selected parking sites and theme park. Well, it is expanding its business to retail purchase by starting with fast food industry that enables consumers to buy dough nut, burger or fast-food from 21 outlets such as Burger King, 7-Eleven, Dunkin’ Donut. It is imitating the success of Hong Kong’s Octopus Card by setting 5 to 10% of the card holders for retail purchase as current target of the company.

Pre-paid Vista Cash Card is issued by Four Oaks Bank & Trust Company that given the opportunity for consumers with poor credit record and young children by not spending
more than the balance on the card. Visa permits travelers access to money at automated teller machines in 65 countries and book the train tickets by offering prepaid cash card such as Metro Card in New York City.

Octopus Card was launched in Hong Kong on year 1997, September. It is a rechargeable contactless stored value smart card which used to transfer electronic payments in online in offline system. It is widely used in payment system for transportation, supermarkets, fast food restaurant, car parks and other pint of sale application such as service stations and vending machines that have achieved good outcomes.

For further information, please refer those links:

1.http://www.startecredit.com/creditpages/prepaid-credit-cards-applications-prerpaid-reloadable-credit-cards.htm

2. http://www.freepatentsonline.com/5621787.html

3. http://en.wikipedia.org/wiki/Octopus_card

4. http://www.touchngo.com.my/

Credit Card debts: Causes and Prevention

Nowadays, cost of people living has increased and it indirectly creates many problems towards many peoples. Many people like to use future money (credit card) as they didn’t have enough cash in hands. This made the numbers of credit card debts increase until create the major problems of bankruptcies each year. This is because many people never realized of its consequences of financial and non financial perspectives.

Factor that bring the causes of credit card debts

1. Poor money management
Poor money management is one of the bigger causes that why people have accumulated many credit card debts. Due to poor money management, people are not aware to conduct a monthly spending plan and do not keep monthly bills or receipt to record how many money are spends. Without keeping bills or receipt, people will never realized how much their spending on the product, and raise a number of debts in one month. With using credit cards, people will like to keep on spending with using the future money without perceive that they are unable to pay back the debts.

2. No saving cushion
When people using credit cards, they would like to use the future money and have not extra money to save in bank. When people are spending more than their income, they will be very hard to manage their savings accounts. The benefit of saving is to help you in cover your over expenses, in the case when you faced problems of divorce, job layoff, illness and others emergency expenses.

3. Unemployment
Due to bad economies, many people lost their job and unable to maintain their living expenses, this makes people using the future money (credit card) to cover their future living expenses. For households, they need cover many expenses purposes to maintain their current lifestyle by over using the credit card. This may lead to a rise in debt when expenses are not cut down to cover the reduction in income.

Prevention methods

1. Making a budget
We need to have a clear budget plan and need to keep all the expenses of receipt or bills in order to record how much money was use. This can help us to perceive that we will not overspending our budget that we have set before and prevent from the debts.

2. Self control and discipline
People who using credit cards should learn how to have a better self control and discipline in order to learn not to overspend it. People can control themselves by limit their credits cards amount by stop them to use the money if they was expenses more than their budget.

3. Contacting and dealing with creditors
You can address the problem with creditors instantly to indentify whether they could give revised on payment arrangement when you facing trouble on to pay off the debts. If the collection money from creditors is not fair, you can refer to Fair Debt Collection Practices Act to indentify debts problems.

Electronic currency

Electronic currency also known as e-money, electronic cash, digital money, digital cash or digital currency and which refer to money or scrip that is exchanged only electronically. It involves the use of computer networks, internet, and the digital stored value systems. The examples of electronic currency are Electronic Fund Transfer (EFT) and direct deposit. EFT refers to the computer-based systems used to perform financial transactions electronically while direct deposit is a banking term used to refer to certain systems used to transfer money.

Electronic Currency Trading System (ECTS) is an investment platform that offers its customers a safe, efficient way to trade foreign currencies against the strength and weakness of the US dollar. It involves converting base currency to a foreign currency at the market exchange rates through an online brokerage account.

Electronic currency allows its holder to buy the goods and services that the vastness of the internet offers. It can let you to do business and earn money from the investment by the lost transaction cost, it unlike the store business that will eat up your profit with a huge amount of fees. There are some examples of websites that can let people to do e-currency trading such as MG E-currency, JT GOLD.com.

There are some benefits of using the electronic currency. Firstly, the currencies can serve as universal media of exchange. If user acquired a global electronic currency, he or she can enter into any transactions around the world without paying any exchange fees. Secondly, the currencies provide global units of account that enable buyer and sellers able to compare which goods and services are worth without any calculation. The third benefit is the global e-currency serve as stable stores of value. The competition will drive out the unstable products from the market and the national monies, the private currencies will not be subject to the inflationary monetary policies of national governments and the special interests they represent.

Major electronic currencies on the net are:

PayPal located in San Jose, California, PayPal was founded in 1998 and was acquired by eBay in 2002. It is the safer, easier way to pay and get paid online. The service is available in many ways through credit cards, bank accounts, buyer credit or account balances, without sharing financial information. It enables global ecommerce by making payments possible across different locations, currencies, and languages.

Ikobo is an online payment system. Users can send and receive money online instantly from over 700,000 ATMs in over 170 international countries.

Moneybookers enable users to pay anyone with an email address. The recipient receives the payment instantly. It beats the cost, delay and inconvenience of traditional payment methods. Clients can send money from a credit card, transfer money to and from a bank account. Merchant business services offered with site integration for accepting payments.
Electronic currency- E-Micropayment systems:

The following are companies with e-micro payment products:

- Pay Loadz
- Bit Pass
- Peppercoin
- Pay stone

PayLoadz offers a unique digital download delivery service for anyone wishing to sell intangible goods online. Payloadz is a service to sell intangible products such as software, e-books, digital art, manuals, articles and files. It is an automated delivery service. This means that seller can go on vacation without worrying about sending download links to the consumers every time a payment is made.

Bitpass was one of the online payment systems for digital content and services. It was founded in December, 2002 and the co-founder was Kurt Huang. Besides, it also partnered with major technology and financial services companies such as Microsoft, PayPal, the Royal Bank of Scotland and First Data. Bit Pass system works similarly to a pre-paid telephone card such as you sign up for the service and put money into your account using a credit card or PayPal, which gives you credit towards the purchase of content.

Peppercoin(peppercoin.com) was founded by Ron Rivest and Silvio Micali with a vision to enable convenient and profitable credit and debit card use for small payments. The users do not require depositing credit in advance. All of the things they need to do, it is just enter their credit or debit cards information with the merchant online as usual.

Paystone Technologies Corp. is a private Internet payment and money transfer company dedicated to providing secure, easy, real time Internet transactions. Paystone was founded in 2001 and it provides an inexpensive online payment method without the risk of chargeback from fraudulent credit card use. Paystone can efficiently handle small financial transactions (micropayments) as low as $0.25. The ability to process micropayments opens a whole new world for entrepreneurs of all sizes. A small business or individual now has a method of generating revenue from their website quickly, easily and inexpensively. This makes a whole new range of content available to personal account holders. The large online merchant can also realize the full benefits of the Paystone solution to expand and increase the profitability of their business.