As technology advances, payment methods have also undergone many changes. From initially only using cash, now various non-cash payment systems have emerged to facilitate and increase security in every transaction.
This article will discuss further the definition of payment, types of payment systems, and the differences between cash and non-cash payments. Read on to find out which payment method best suits your needs!
What is Payment?
Secara umum, “payment” berasal dari bahasa Inggris yang berarti “pembayaran” dalam bahasa Indonesia. Dikutip dari Investopedia, payment is the process of exchanging money, goods, or services in return for goods or services that have been previously agreed upon by all parties involved.
Payment can be made in various ways, such as exchange services, cash, checks, wire transfers, credit cards, debit cards, and others.
Simply put, payment is the act or process of paying in a buying and selling activity. Currently, payments have evolved into various forms, both cash and non-cash.
What is a Payment System?
Payment System is a system or method used to complete the payment process between buyers and sellers.
This system involves technological infrastructure, financial institutions, and transaction processes that ensure money moves from buyers to sellers in a safe and efficient manner. Payment systems can be in the form of cash or non-cash.
Payment Example
1. Cash Payment System
The cash payment system is a conventional payment method that has been used since the introduction of the Republic of Indonesia Currency (ORI) in 1946. Although there are many modern methods, cash remains popular, especially for small transactions because it has a wide reach and is easily accessible.
Also Read: What is the Payment API System? Come on, get to know how it works!
2. Non-Cash Payment (Cashless)
Cashless payment is a payment system without cash, making it easier for users to make transactions without carrying physical money. Usually, this method is done via mobile devices (mobile payment).
Non-cash payments provide a sense of security and convenience because they reduce the risk of losing cash. Currently, various non-cash payment methods are available, including debit cards, credit cards, e-wallets, and virtual accounts. The following is an explanation of non-cash payments:
- Debit and Credit Cards: Debit Cards allow users to withdraw money from savings, depending on the account balance. Meanwhile, Credit Cards allow transactions without a balance, but the bank will charge the amount spent with an additional fee, similar to a loan.
- Virtual Account (VA): VA is a virtual account used for automatic payments. Buyers make payments to the company's VA number without the need for manual confirmation, because the company immediately receives payment information.
- E-Wallet : E-wallet or digital wallet is a payment application that is accessed through devices such as smartphones and can be used for various transactions. This system is equipped with security such as passwords, so that only account owners can access it. Examples of popular e-wallets in Indonesia include Gopay, OVO, LinkAja, and Shopeepay.
- QRIS (Quick Response Code Indonesian Standard): is a payment system that can accept various payment methods such as e-wallet or bank transfer through one uniform QR code. This makes the transaction process easier for sellers and buyers because sellers only need to provide one QR code to receive payments from various platforms.
Types of Payment Systems
1.Cash Payment System
This type is a payment system that involves physical money, such as banknotes or coins. Cash payments are very common in society, especially for small transactions or in areas with limited access to digital financial services.
2. Non-Cash Payment System
This system covers all types of payments that do not involve physical money. Instead, this method uses payment instruments such as debit cards, credit cards, e-wallets, bank transfers, and others. The advantages are greater convenience and security compared to cash, as well as ease in tracking expenses.
Also Read: What is a Payment Gateway? Flow, Benefits and How it Works
Differences between Cash and Non-Cash Payment Systems
- Cash Payment System:
- Using physical money, not relying on technology.
- More suitable for small transactions and areas with minimal access to technology.
- There are no transaction fees or dependence on third parties.
- Non-Cash Payment System:
- Using digital devices, such as cards, apps, or QR codes.
- Suitable for various transactions, especially in large amounts or long distances.
- Usually requires an internet connection and sometimes additional fees.
Above is an explanation of what payment is and the various types of payment systems that can be used. If you have a business and need a solution to automate payment methods, Ayolinx is the answer!
With support for a variety of cash and non-cash payment methods, Ayolinx offers a safe, fast and convenient payment experience for your business.
Open API features, Payment Link, and a complete dashboard to monitor all transactions will make it easier to manage your business finances. So, what are you waiting for? Register your business now and experience the convenience together Ayolinx!