Many of us are not aware that we use and own digital money. When we think of money, the images that come to our minds will be of wads of banknotes and stacks of coins. Little do we know that out of all the money in the world, only eight percent is physical money.
You can’t touch it
Most of the money in the world exists in electronic form like a Bitcoin. Virtual, you can’t hold it but you can cash it out. When you think of our electronic payment system, it is kept in digital form until we cash it out.
When it exists online
When money exists online and is acceptable as a payment, it is digital money. There are different kinds of digital money such as cryptocurrency. The various banknotes of different currencies are also digitized. Other forms of digital money are digitalized gift certificates and vouchers. Electronic checks also are a form of digitalized money.
Money doesn’t actually move
Moving funds electronically means that the funds don’t actually move. The amount, like when you transfer money, upon authorization, is debited from your account and credited to the recipient’s account. Electronic funds transfers are done through networked financial institutions like paxum.com so you can send and receive funds from banks, credit cards, debit cards, money services like PayPal, and cryptocurrency exchanges that are linked. The digital infrastructure is for both local and international such as that for cross-border payments.
The speed of the internet
There are several benefits of using the speed and accuracy of financial transactions during this digital age. When those who don’t have the electronic payment infrastructure and slow internet have to fall in line, areas that do accept mobile payments boost their economy.
Faster transactions mean that we can save time. When people have more time, they get to be more productive. If you think about the countless hours that you have lost because of waiting in line, you would surely wish that all payment transactions can be digitized.
Boosting the economy
It is also important to be able to transfer money quickly for businesses to prosper, instead of waiting for a few banking days for the money to clear as their budget depends on the payment. The boom in the global economy is partially due to the speed and ease of online payment methods.
Of state-backed currencies
When it became possible to digitize money, the banking sector embraced technology. It is much cheaper to keep the funds in electronic form rather than in a vault. To transfer money using an armored car is more expensive than authorizing a payment transaction. Thus, the networks for money transfer such as SWIFT were established to be able to use ‘messages’ to transfer funds to their linked financial institutions.
Advanced payment solutions
As we now rely a lot on our mobile devices, it is much easier to send and receive funds with the use of our mobile browser or an app. There is a money services app that provides you with advanced payment solutions to send authorize ‘messages’ to various financial institutions for transferring funds. The benefit of using this money services app it that you can use it to access most of your digitized money accounts like that a bank account.