Banking Applications (Cambridge (CIE) IGCSE ICT)
Revision Note
ATM
What is an ATM?
An Automatic Teller Machine (ATM) is used in the banking industry to provide customers with convenient access to financial transactions 24/7
Characteristics and uses of ATMs:
Withdrawing cash: Obtain money from a bank account
Depositing cash or cheques: Add funds to a bank account
Checking account balance: View the current balance of a bank account
Mini statements: Obtain a summary of recent transactions
Bill paying: Settle utility bills and other payments
Money transfers: Sending funds to another bank account
Advantages and disadvantages of ATMs
Advantages | Disadvantages |
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EFT
What is EFT?
Electronic Funds Transfer is a way of moving money from one account to another
EFT is used primarily for:
Salary deposits
Bill payments
Online purchases
EFTPOS
Electronic Funds Transfer Point Of Sale (EFTPOS) is used by retailers to allow customers to make purchases using a debit/credit cards
The process involves:
Data being read from the chip (using RFID / NFC if it's a contactless payment)
The business bank's computer contacts the customer’s bank's computer
The card is checked if it is valid
If the card is valid the transaction continues
If it is not valid the transaction is terminated
An authorisation code is sent to the business
The price of the item is deducted from the customer’s account
This money is added to the business' account
Advantages and disadvantages of EFT
Advantages | Disadvantages |
---|---|
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|
Internet Banking
What is internet banking?
Internet banking is a secure online platform for accessing and controlling a persons bank account
Internet banking can be accessed via the internet through a secure website or by using the bank's official app on a smartphone
Internet bank allows for transfers, bill payments, account management and much more
Advantages and disadvantages of Internet banking
Advantages | Disadvantages |
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Exam Tip
Sometimes the question will be about advantages and disadvantages of going to the bank rather than using online banking. Read the question carefully (you can reverse the statements in the table above)
Worked Example
Adam is paying his bill in a restaurant using a contactless debit card.
Describe the computer processing involved in Electronic Funds Transfer (EFT) using contactless cards.
[4]
Answer
Four of:
The reader checks the amount to pay is less than the contactless limit [1]
The data is read from the chip using RFID / NFC [1]
The restaurant’s bank's computer contacts the customer’s bank's computer [1]
The card is checked if it is valid [1]
If valid the transaction continues [1]
If not valid the transaction is terminated [1]
An authorisation code is sent to the restaurant [1]
The price of the meal is deducted from the customer’s account [1]
Added to the restaurant’s account [1]
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