Digital methods of payments have been around for quite some time. Unlike cash it is not a physical form of money. It is an electronic form of making payment. The supporting structure behind digital money or e-currency is technology. Credit cards and debit cards are the older forms of digital money that have been used by Indians for making payments in the physical world for some time now. These form of payments gained preference over cash or cheques over a period of time as they were considered safer. Andhra Bank was the first bank to introduce credit cards in India in 1981 whereas HSBC was the first bank in India to introduce the ATM and the debit card in 1987.

In order to recharge online prepaid mobile connection and DTH connection, the electronic money is the only form of payment that is accepted. You cannot pay cash or cheque or Demand Draft to the operator or the retailer to make payments. The common digital payments methods today are:-

  1. Credit card – the most widely used electronic money during online recharge and other e-commerce activity. In order to use this method one is required to feed in the 16-digit card number along with the expiry date, the CVV and the credit card holder’s name in the payment page. This is considered to be the safest method of paying online as the card is not directly linked to one’s bank account.
  2. Debit card – the second most popular method of making online payments, this card is your ATM card that has a direct connection to your bank account. To use this method too, the customer needs to input his 16-digit debit card number, the validity, the CVV and the card holder’s name in the space provided on the payment page.
  3. Bank Transfer – also known as Netbanking, this form of e-payment during recharge and bill payments or shopping online, the customer is required to provide his banking customer ID or Account number along with password to enter his bank account from where he can transfer the money by using Netbanking PIN or One Time Password sent on his registered mobile or email address.
  4. Payments Bank – one of the latest forms of banking that has entered India it enables its registered users to hold a balance up to Rs. 1 lakh in their account and use the same against online and offline transactions instead of cash. In this case, the smart phone of the customer is the mobile money – it was conceptualized and introduced in India because there are millions of people in this country who still do not have a bank account in their name though they are using mobile devices. The thought was to make them use their mobile devices to make payments rather than deal in cash.
  5. Electronic Wallets – it operates similar to the Payment Banks. This is a wallet that is filled with money from your bank or credit card. Once balance is available it can be used for making online and offline payments.