Cashless Society

E-Learning 1(31st Jan – 1st Feb 2008)

Instructions

Read through the presentation slides on “Cashless Society”

You are then supposed to do Activity 1, 2, 3 and Review Exercise CEL 4

Submission Deadline

4th February 2008 (Monday)Late submission will be dealt with

severely.

Objectives1. Give examples of how computers are used

in the bank, such as for cash dispensing, cheque processing, management of customers’ accounts and online banking

2. Mention how data is captured through the use of OMR, MICR, magnetic strips and barcodes

3. State that a personal identification number (PIN) is commonly used as a security measure when using a smart card

4. Understand that the trend is towards cashless electronic transactions

Introduction Computers are used in many

places Popular because

Cost reduction Communication Growth of Information and

Communication Technology (ICT) industry

Computers in Banks Commonly seen computers in banks

Back-office operations Confidential activities

Cheque processing Management of

customers’ accounts Online banking

Computers in Banks

Computers in Banks

Benefits to customers• Convenience

ATMs found in many places

• Accessibility Computers can work long hours

• Security All transactions are recorded

• Predictability Computers are predictable

Computers in Banks

Why Electronic Banking is Popular?

Benefits to banks• Low cost

Banks do not need to open many branches and employ many people to serve a majority of customers

• Security Security features are built into ATMS e.g.

camera

• Accounting Computers makes capturing transaction records

easier

How Data is Stored

On identity cards

Magnetic strips Manufacturing cards with magnetic strips is

cheap Magnetic strips reader are affordable

Smart chips Computer chips that store information Identification information

How Data is Stored

Smart chips Safer than magnetic strips

Credit card companies turning to smart cards because Credit card fraud Difficulty in counterfeiting

smart cards Extra security Bonus features

How Data is Stored

Using OMR (Optical Mark Recognition)

How Data is Stored

Using OMR Simplify data entry Becoming popular because OMR

scanning is Fast Accurate Cost effective Easy to implement

and support

How Data is Stored

• Using MICR (Magnetic Ink Character Recognition)• Used in bank cheques• Computerises the cheque clearing process

• Special symbols printed on cheque

How Data is Stored

• Using MICR • Computerises the cheque clearing process • MICR reader magnetizes and translates symbols

• Cheque information transmitted to Automated Clearing House (ACH)

• Cheques also read and sorted with a MICR reader/ sorter at the ACH

• Banks able to process cheques faster and cheaper

How Data is Stored

Using Barcodes Used to store information Cheap to make Easy to read

How Data is Stored

Cashless Electronic Transactions Increasingly popular

E-commerce Internet banking

Disruptive Technology

Implementing new technology often leads to job losses initially

Workers’ jobs replaced by computers

New technology Makes life better Lower business costs

Businesses grow and new jobs created

The End

You are reminded once again to do Activity 1, 2, 3 and Review Exercise CEL 4

Submission Deadline

4th February 2008 (Monday)Late submission will be dealt with

severely.