Digital Payment Paired Strings between Customers and Banks

Digital Payment Paired Strings between Customers and Banks

Paired Payment strings contain the details of the payer and the payee integrated with the payer’s bank. It is impossible to take the benefit for a different pair other than the intended receiver.

Allowing the user to make a mistake and then correcting is not the right approach rather don’t allow the mistake to happen. We prepare a drawing first, before constructing and then complete the building as per the plan. Before completing the transaction it is secured by verifying the destination entry and the destination address and then carried out. Millions of unauthorized transactions can be prevented by this method.

Payment transaction flow should follow a triangular path to ensure safety. Initiating a payment always starts with a pair of transaction entries from the source, one to the bank and the other to the destination. Here destination is the receiver who transfers the entry to the bank which ensures the destination address and assures the ‘Account Payee’ feature. The banks role is to authenticate the paired digital payment strings and allow them for completing the transaction. The benefit of this method is that the accounting is done at both the points of source and the destination with the corresponding entries at the bank. The full payment cycle is completed.

As an extension of UPI payments & receipts, a paired payer/payee address may be created like one given below:

up@hdfcbank#upp@kotak .  

For the rever

Reverse EMI for Senior Citizens

Self planned Reverse EMI after Sixty.

Deposit interest rates are falling. Need for funds increases. How to bridge the gap? Keeping all the savings in Fixed and Cumulative Deposits may not be a wise plan especially for Senior Citizens. Interest yield is not comfortable leading to shortage of liquidity. After allocating a reasonable amount in interest yielding Deposits, one should think of drawing both interest and principal that will increase the cash flow and make an efficient use of their resources in their life time as Reverse EMI.

From the amount deposited a desired percentage is drawn every month which is more than the normal interest payable for that deposit. While interest is added to the principle a fixed Reverse EMI is paid to the depositor. The scheme is flexible allowing varying the percentage of the withdrawal on the deposit amount. In blocks of three or five years the balance amount from the original deposit may be continued for a further period of three years or topped up to the desired value. TDS is only for the interest credited and not fog the REMI amount.

To maintain a high Utility Quotient, one should enjoy the fruits of the hard earning and not necessary to block a large amount that yields a meagre amount. A model working sheet is given below:

REMI may be flexible varying like 1.25, 1.5, o 1.75% per month on the invested amount.

			8.75%	1.25%	p.m.
Year	Investment	Principal	Interest	Reverse	TDS	Closing
		Received	Credited	EMI   x 12	10%	Balance
1	10,00,000	65,420	84,580	1,50,000	8,459	9,26,121
2	9,26,121	72,122	77,878	1,50,000	7,788	8,46,211
3	8,46,211	79,373	70,627	1,50,000	7,063	7,59,775
4	7,59,775	87,215	62,785	1,50,000	6,280	6,66,280
5	6,66,280	95,699	54,301	1,50,000	5,432	5,65,149
		3,99,829	3,50,171	7,50,000	35,022

			8.75%	1.50%	p.m.
Year	Investment	Principal	Interest	Reverse	TDS	Closing
		Received	Credited	EMI   x 12	10%	Balance
1	10,00,000	96,652	83,348	1,80,000	8,335	8,95,013
2	8,95,013	1,06,176	73,824	1,80,000	7,383	7,81,454
3	7,81,454	1,16,479	63,521	1,80,000	6,352	6,58,623
4	6,58,623	1,27,624	52,376	1,80,000	5,240	5,25,759
5	5,25,759	1,39,679	40,321	1,80,000	4,033	3,82,047
		5,86,610	3,13,390	9,00,000	31,343

New Paperless Cheques

To the attention of RBI, Banks and all the business community

doing bank transactions.

U.P. Prakasham, Managing Director, Nebula Solutions Ltd.  (+91 9840033881)

In the wake of RBI allowing new banks to come up for small payments, embracing technology into play is advantageous.

Approval and adaptation of a new methods using technology will bring in a comfort level for regular business payments by ordinary and non tech savvy citizens. Email like convenience (but NOT Email) can be provided for routine payments.

Imagine whenever a cheque is issued, a copy is also sent to the bank. When the recipient deposits that cheque, bank verifies with the copy already sent by the issuer and then clears for payment.

‘theCheques’ is a paperless new electronic cheque similar to that, very convenient act like regular cheques with added security. All the stake holders namely, the payer, payee and the bank are safe guarded by its unique method. 

As early as 2004, the author had exchanged with a closed group, a White Paper on ‘Small Payments through Cell phones’, including a write up giving full scheme of a ‘Real Time Mobile Payment Gateway Service’ (RTMPGS) -The documents are still available in the rediffmail account with the time stamp. At that time it was too early for the market to accept and further steps were not pursued. The following proposal should not be ignored and taken up for serious consideration.

I am submitting this document to RBI for approval and then all the banks can try ‘theCheques’, initially with the customers of the same bank for transacting between them and then extend for inter-bank transactions. Important add on is, it will provide, ledger, trial balance and reconciliation statements to all the customers using www.theCheques.com (under construction). The entries can also be pushed into the regular accounting packages, preventing re-entry of thousands of transaction details. It will give full control to all the users using the entire set of financial reports. Instances of Cheque Returns will be reduced to a considerable extent.

Environment friendly is so much talked about but bringing into action is not at the desired level. Tons and tons of paper will be saved by avoiding paper cheques which in turn will reduce the cutting of trees leading to ‘Green Transactions’. Writing cheques will become history and it will change the way people transact.

All the vendors of banking software should consider for extending ‘theCheques’ to their business customers who will be thankful for providing such a long awaited facility hitherto ignored. The author will be glad to share the details when called for.