E Payment System

A Study on Impact of E-Payment System on Consumers
CHAPTER 1: INTRODUCTION
Synopsis:
1.1 Introduction
1.2 The evolution of Electronic payment system
1.3 Types of electronic payment system
1.4 Benefits of electronic payment system
1.5 Advantages of electronic payment system
1.6 Disadvantages of electronic payment system
1.7 Techniques of electronic payment system
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1.1 INTRODUCTION:
An electronic payment system is a way of making transactions or paying for goods and
services through an electronic medium without the use of cheques or cash. It is also called as
online payment system. The electronic payment system has grown increasingly over the last
decades due to the growing spread of internet-based banking and shopping. As the world
advances more with technology development, we can see the rise of electronic payment
systems and payment processing devices. Due to their increase, improvement and providing
ever more secure online payment transactions the percentage of cheque and cash transactions
will decrease. Normally electronic payment is done via debit, credit cards, direct bank deposits
and e-cheques, another alternative
e-payment methods like e-wallets, bitcoin, cryptocurrencies, bank transfers are also gaining
popularity. An electronic payment simply means you are paying for products or services via
the internet, which most people do daily. Electronic payments are routed through an electronic
‘superhighway’ system that ultimately delivers the payment into the bank account of the
person or business being paid. Not only is it more convenient than cash or paper cheques, it’s
also less expensive and more secure. When it comes to payment options, nothing is more
convenient than electronic payment You don’t have to write a cheque or handle any paper
money. All you have to do is enter some information into your web browser and click your
mouse. It’s no wonder that more and more people are turning to electronic payment or e-
payment as an alternative to sending cheques through the mail. In addition, the electronic
payment system in India has expanded and is trying to provide numerous payment options to
meet the ever-growing industry needs, while incorporating visa and master credit cards. The
purpose of an e-payment system is to benefit consumers in terms of convenience and lower
transaction costs. Consumers can access and manage their transactions remotely via web-based
user interface as it is supported by the high setup of broadband services and penetration rate.
The RBI plays a pivotal role in the development of India’s payment and settlement
systems for both large-value and retail payments. The central bank played a pioneering role in
automating the paper-based clearing system in the 1980s. It introduced an electronic funds
transfer system and electronic clearing services (ECS Credit and Debit) in the 1990s. The
special electronic fund transfer (SEFT) system was introduced in April 2003 (subsequently
discontinued in March 2006, after the implementation of the National Electronic Fund Transfer
(NEFT) system in November 2005) and the real-time gross settlement (RTGS) system in
March 2004. The RBI operates the RTGS, which has replaced the paper-based inter-bank
clearing system and settles a sizeable volume of large-value and time-critical customer
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transactions. RBI also manages the clearinghouses (for paper-based and electronic clearing) in
17 large cities while operating the clearinghouses at four major Locations. It is the settlement
banker in these cities. The RBI introduced the NEFT system in November 2005. Together with
ECS, this forms the electronic retail payment infrastructure.
The National Electronic Clearing Services (NECS) system, which aims to centralize
the Electronic Clearing Service (ECS) operation and bring uniformity and efficiency to
the system, was implemented in September 2008. At present, the NECS settles on credit
transfers.
Definition:
“Any transfer of funds initiated through an electronic terminal, telephonic instrument or
computer or magnetic tape so as to order, instruct or authorize a financial institution to debit or
credit an account.”
EPS is a financial exchange that take place online between buyers and seller.
The content of this exchange is usually some form of digital financial instrument (such as
encrypted credit card number, e-cheque or digital cash) that is backed by a bank or an
intermediary or by a legal tender.
A payment system means ensuring payment security, transaction privacy, system integrity
customer authentication and purchaser’s promise to pay.
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1.2 THE EVOLUTION OF ELECTRONIC PAYMENT SYSTEM:
The payment system has grown significantly along with technological advances. In 1914 a
shopping center, oil company, western union issued a customer card to provide convenience to
customers in making payments for the goods or services they would use, along with this, the
banking industry issued credit cards. Initially, all paper-based credit card payment, until the
1990s when the card was fully transformed into electronics. The evolution of electronic
payments began in 1918 when the Federal Reserve Bank first transferred currency via
telegraph. With the evolution of e-commerce and technological advancements, electronic
cashless payments are now used conventionally even though they have been designated in
1960. The research community has made tireless efforts so in the development of various
online payment models such as Model Asokan N. and JW models.
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1.3Types of Electronic Payment System:
1) Credit card:
The most popular form of payment for e-payment transactions is through credit cards.
It is simple to use; the customer has to just enter their credit card number and date of
expiry in the appropriate area on the seller’s web page. To improve the security system,
increased security measures, such as the use of a card verification number (CVN), have
been introduced to online credit card payments. The CVN system helps detect fraud by
comparing the CVN number with the cardholder’s information.
2) Debit card:
Debit cards are the second largest e-commerce payment medium in India. Customers
who want to spend online within their financial limits prefer to pay with their debit
cards. With the debit card, the customer can only pay for purchased goods with the
money that is already there in his/her bank account as opposed to the credit card where
the amounts that the buyer spends are billed to him/her and payments are made at the
end of the billing period.
3) Smart card:
It is a plastic card embedded with a microprocessor that has the customer’s personal
information stored in it and can be loaded with funds to make online transactions and
instant payment of bills. The money that is loaded in the smart card reduces as per the
usage by the customer and has to be reloaded from his/her bank account.
4) E-Wallet:
E-Wallet is a prepaid account that allows the customer to store multiple credit cards,
debit card and bank account numbers in a secure environment. This eliminates the need
to key in account information every time while making payments. Once the customer
has registered and created E-Wallet profile, he/she can make payments faster.
5) Net banking:
This is another popular way of making e-commerce payments. It is a simple way of
paying for online purchases directly from the customer’s bank. It uses a similar method
to the debit card of paying money that is already there in the customer’s bank. Net
banking does not require the user to have a card for payment purposes but the user
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needs to register with his/her bank for the net banking facility. While completing the
purchase the customer just needs to put in their net banking id and pin.
6) Mobile Payment:
One of the latest ways of making online payments are through mobile phones. Instead
of using a credit card or cash all the customer has to do is send a payment request to
his/her service provider via text message the customer’s mobile account or credit card
is charged for the purchase. To set up the mobile payment system, the customer just has
to download a software from his/her service provider’s website and then link the credit
card or mobile billing information to the software.
7) Amazon Pay:
Another convenient, secure and quick way to pay for online purchases is through
Amazon pay. Use your information which is already stored in your Amazon account
credentials to log in and pay at leading merchant websites and apps. Your payment
information is safely stored with Amazon and accessible on thousands of websites and
apps where you love to shop.
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1.4 Benefits of Electronic Payment System:
The e-payment systems will also allow you to make cash applications instantly and let you
reconcile your financial records with great accuracy. This will eliminate your accounting errors
and help you to keep your records clearer. But the advantages of using an electronic solution
for payments are not just limited to this here are some essential benefits of electronic payment
system:
1. Instant payment:
Electronic payments are much faster than the traditional methods of payments such as
cash or cheques. In the case of online payments, you do not have any constraint of time
location. You can easily make payments at any time from anywhere across the globe.
E-payment systems have eliminated the need for going to the banks to make payments.
Now your customers do not have to waste their time standing in the long lines at banks.
They can easily pay you by using an electronic payment app.
2. Higher payment security:

Despite its robust features, electronic payments systems have not become so popular
among the merchants. They are still using the same old methods for accepting
payments. Due to which, they are missing out the opportunity for serving more
customers.
3. Better customer convenience:

Electronic payments can help you to provide convenient payment experience to your
customers. It allows your customer to purchase goods on credit by offering them with
the pay later facility. Instead of sending constant reminders for payment to your
customers, you can automatically collect money after a specific period.
4. Saves processing costs:

If you want to provide payment services to your customers then you first need to tie up
with a card processor. The processor will provide you with a payment gateway for
processing and in exchange, it will charge fixed cost from you. This cost is very high.
On the other hand, if you are using an electronic payment system in your business then
you do not have to incur such high charges. You just have to pay a fixed subscription to
your service provider.
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5. Low risk of theft:

The phrase ‘Cash is the king’ is popular in the business world, but this king has also
had some limitations. If you are using cash for accepting payments from customers,
chances are there it can be stolen. Also, you need to take high safety measures in
depositing cash into your bank account. But this risk can be decreased if you are using
a secure electronic payment system in your business. By using it, you do not have to
worry about your payment record. You can easily get an accurate record of all your
transactions at the end of the day.
6. Transparent:
Transparency becomes an essential factor when it comes to payments. And when you
are using the digital medium for accepting payments, then it becomes essential for you
to maintain transparency in your transactions. In the case of electronic payments, you
do not have to worry about the record of your payment details. Also, you can provide
the payment details to your customers beforehand. So that there will be fewer chances
of confusion.
7. Contactless:
In the times of the COVID-19 pandemic, people have started finding ways of avoiding
human touch to save themselves from getting affected by the coronavirus. Due to this,
the need for contactless payments has increased. You can use contactless POS
terminals in your business to avoid the human touch. In this system, the payee needs to
hold his phone near the terminal and his payment will get automatically processed.
Also, you can enable your customers to make payments by using QR codes or One
Time Password (OTP).
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1.5Advantages of Electronic Payment System:
 Increases speed:
We do not have to worry about carrying paper money or wait in line to withdraw
money from ATMs. Through E-payments you can pay anyone at any time.
 Increases sales:
As people are able to pay to anyone and are not much dependent, the demands of
products in the market have increased which resulted to increase in sales of almost
every product.
 Instant Receipts:
As soon as you make an online payment, you receive receipts and feedback almost
instantly.
 Better Deals:
As people are getting more indulged in e-payments, almost every payment service
provider has started giving exciting offers helping people get good deals.
1.6Disadvantages of Electronic Payment System:
 Service fees:
Many a time while using e-payment service we are liable to pay service fees or a
convenience fee which adds to our expense.
 Risk of Theft:
There have been many incidents in which cybercriminals have manipulated people and
money has been looted.
 Technical Problems:
As it is an online service, it may go down due to technical issues and people who get
100% reliable on this service for their payments may face an issue.
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 Remote Areas:
Remote areas still rely on cash. You might find it difficult in making payments on the
go while traveling to some remote areas.
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1.7 Techniques of Electronic Payment System:
o National Electronic Funds Transfer System (NEFT):
National Electronic Funds Transfer (NEFT) is one of the most prominent electronic funds
transfer systems of India. Started in Nov.-2005, NEFT is a facility provided to bank customers
to enable them to transfer funds easily and securely on a one-to-one basis. It is done via
electronic messages. This is not on real-time basis like RTGS (Real Time Gross Settlement).
This is a "net" transfer facility, which is executed, in hourly batches resulting in a time lag.
NEFT facilities are available in 30,000 bank branches all over the country and work on a batch
mode.
NEFT has gained popularity due to it saving on time and the ease with which the
transactions can be concluded. This reflects from the fact that 42% of all electronic
transactions in the 2008 financial year were NEFT transactions.
o Card based clearing (CBC):
As mentioned above India is one of the fastest growing countries in the plastic money
segment. Already there are 130 million cards in circulation, which is likely to increase at a
very fast pace due to rampant consumerism. India’s card market has been recording a growth
rate of 30% in the last 5 years. Card payments form an integral part of e-payments in India
because customers make many payments on their card-paying their bills, transferring funds
and shopping.
Ever since Debit cards entered India, in 1998 they have been growing in number and
today they consist of nearly 3/4th of the total number of cards in circulation.
Credit cards have shown a relatively slower growth even though they entered the
market one decade before debit cards. Only in the last 5 years has there been an impressive
growth in the number of credit cards- by 74.3% between 2004 and 2008. It is expected to grow
at a rate of about 60% considering levels of employment and disposable income. Majority of
credit card purchases come from expenses on jewelry, dining and shopping. Another recent
innovation in the field of plastic money is co-branded credit cards, which combine many
services into one card-where banks and other retail stores, airlines, telecom companies enter
into business partnerships. This increases the utility of these cards and hence they are used not
only in ATM’s but also at Point of sale (POS) terminals and while making payments on the
net.
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o Real-time gross settlement (RTGS):

Real-time gross settlement systems (RTGS) are specialist funds transfer systems were
Transfer of money or securities takes place from one bank to another on a "real time" and on
"gross" basis. Settlement in "real time" means payment transaction is not subjected to any
waiting period.
The transactions are settled as soon as they are processed. "Gross settlement" means
the transaction is settled on one-to-one basis without bundling or netting with any other
transaction. Once processed, payments are final and irrevocable.
RTGS systems are typically used for high-value transactions that require immediate
clearing. In some countries the RTGS systems may be the only way to get same da cleared
funds and so may be used when payments need to be settled urgently. However, most regular
payments would not use a RTGS system, but instead would use a national payment system or
network that allows participants to batch and net payments.
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CHAPTER 2: REVIEW OF LITERATURE
Kevin Foster, Scott Schuh, and Hanbing Zhang (2010) they examined the consumer
payment methods with respect to cash holdings and withdrawals which was decreasing since
2010.There was an increase in card payment system with respect to 2009 in the year 2010,
which resulted in less usage of paper currency. Since 2010 there was an increase in usage of
debit and credit card compare to cash transaction which
slowly took a decline giving rise to prepaid payments.
Singh. A et.al (2012) in their study discussed how secure the internet network should be to
make smooth transaction for all the parties and the merchants. The systems are made in such a
way so that there is no fraudulent activity takes place people can use their card for transaction
in a secure way so that no data is shared. People mostly do digital transactions for e-commerce
but they find internet I not secure to do so.
Therefore, some strict protocol should be followed and managed to make transaction secure
and the data is also protected.
Oladejo, Morufu et.al (2012) in their study examined the improvement of e-payment system
in Nigeria. They explored that how electronic payment system affect customers. A structured
questionnaire and some financial statements were collected to analyze the data. The results
were such that the impact of electronic payment system on customers are very positive. With
the advent of e-payment system there was a rise in usage of ATMs.
Nitsure (2014) in his study highlighted the issues that were being faced or observed in
developing country like India in using the e-payment system which was due to the low spread
of internet and technology. The paper focused on major issues such as security, rules, etc. IN a
country like India there is a high risk where the poor are given a chance to be informed about
such facilities neither they are given any such information.
Rakesh H M & Ramya T J (2014), in their study analyzed the factors that which was
resulting in the impact of e-payment system on consumers. It was found out that perceived
reliability, Perceived ease of use and Perceived usefulness were the main reason for the
positive impact on consumers.
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Sanghita Roy, Dr. Indrajit Sinha (2014), discussed in their paper that in India there has been
a sudden surge in the usage of digitalized payment. But still there are almost 90% transactions
which are done through paper currency. They had used the TAM (Technology Acceptance
Model) in this stud to find out the factors which are strengthening the e-payment system the
factors are innovation, incentives, and legal
frame work and customer convenience.
Dennehy & Sammon (2015) has analyzed how in the 21st century the usage of digital
payment has increased over the years. The main focus here was to find out how where will in
the digital payment system in future stand. Many papers have been examined to find out what
are the views regarding the digital payment system. With the passage of time the technology
has been shifting very fast so with the innovation of technology the aim was to make people
familiar with digital payment. The merchants also got a new
platform to invest so as to cater the customers. Data was collected by following empirical
method i.e., survey, interviews, etc. Lastly the study was only focused on Google data base
that was a limitation about the study.
Sanaz Zarrin Kafsh (2015) made a study on “Impact of e-payment system on consumers in
Canada” in her study she did convenience sampling from where 530 respondents were selected
and there after the Partial least square model was used to test the data. As per the analysis the
result perceived usage, perceived ease of use and perceived security is related to each for
forecasting the impact of e-payment.
Bezhovski (2016) has examined how internet and e-commerce has opened the gateway for
digital payment system with the increment in technology people are adopting the new means of
payment system and how they will be benefited and is there any pitfall of using it. When e-
commerce was launched it was a unique way of trading so the digital payment is also a unique
way of transaction which will also emerge as the e-commerce and in near future it will become
the backbone of e-commerce. The future of these digital wallets will depend on the security
and privacy that are provided by the companies as people are highly security concerns any pros
and cons will decide the future of digital wallets. It is not only restricted to make transactions
but it be used for booking airlines, movie tickets. Many offers are provided for making bill
payments or buying any goods using these platforms. As the smart phones has removed many
devices
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from our daily live and have clubbed in one device only so it is expected that digital wallet will
also do the same which will become substitute for many other things.
Ravi (2017), has examined that India’s two third population are residing rural areas so they
play a very important role in the development of the economy, with the emergence of IT and
Communication it is predicted that rural areas will have 50% of India’s Internet users by
2020.Digital wallets should be used in rural places so that the people know the significance of
using it and what benefit they will be getting by using it. The Government of India has also
taken up the initiative of making rural people aware about
Digitization. Adoption of technology has always been low in India compare to other countries
but in case of Digital wallet our country is going with the pace of other countries to become a
cashless economy. As the two third population of India is in rural part so if the rural people
with time adopt the digital payment system, then in the coming years India will become a
cashless economy. The government of India has taken up various initiatives to make the rural
people become familiar with digital wallet. The urban people have adopted the digital system
of payment, now it’s time for the rural people too. If the rural people are made aware about
digitalization soon it will roll out all over India. The best step that the National Payments
Corporation of India has taken is that digital wallet will work on all mobiles with or without
internet.
Singh (2017) in his study showed that how digital payment and digital wallet in India affects
consumers. As there was a tremendous growth in the usage of internet and the no. of smart
phone users were also increasing so people found it convenient to use as an alternative for
cash. In this study he also pointed out that how different digital wallet companies were having
competition to enter and expand the Indian market as it was the best opportunity for them to
establish their company. It was also predicted that in future India will become a cashless
economy and with digitalization people will surely adopt the digital mode of payment.
ANOVA was used in this study to show that there is no significant variance in the consumer
perception with respect to its demographic factors.
Baghla A (2018) in his study identified the trends for adopting the digital payment system
India and its effect on consumers. Further the paper talks about how after demonetization
people started to use the digital platforms for transactions. How the government initiative to
make our economy a cashless one and how consumer will be adopting such system are further
discussed. A structed questionnaire was used to collect data and find out the future of digital
payment system in India and its impact on consumers.
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Pandey and Rathore (2018) in their study discussed the impact of digital payment system.
Due to modernization and globalization, it was very important for the people to accept the
modern method of payment. The study is based on secondary data and various literatures from
past papers and government data. All data collected has been analyzed and used to find the
impact and adoption of digital payments by the people.
Pushpa S. Abbigeri and Rajeshwari M. Shettar (2018) talked about how the Digital India
flagship program attracted large number of people to start using digital wallets, which people
started to use as there was lots of cash back offers and coupons. After the digital India flagship
program, a lot of mobile wallet companies entered India and other methods such as UPI, NEFT
to a surge. The initiative taken by the government and RBI was being accepted by the people
as they were using such methods.
Shivathanu B. (2019) in his study adoption of digital payment system in the era of
demonetization emphasized on how the digital payment system was used by the people or
accepted by the people during demonetization. It was based on a conceptual framework where
the sample size was 766. The data analyzed suggested that behavioral intentions and
innovation resistance had an impact on the actual usage.
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CHAPTER 3: RESEARCH METHEDOLOGY
Synopsis:
2.1 Objectives
2.2 Methods of data collection
2.3 Sampling plan
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2.1 Objectives of Research:
Research objectives describe concisely what the research is trying to achieve. They summarize
the accomplishments a researcher wishes to achieve through the project and provides direction
to the study. A research objective must be achievable, i.e., it must be framed keeping in mind
the available time, infrastructure required for research, and other resources. Before forming a
research objective, you should read about all the developments in your area of research and
find gaps in knowledge that need to be addressed. This will help you come up with suitable
objectives for your research project. They are crucial in any research since they determine the
kind of questions and procedures to be used in data collection, and analysis. It is necessary to
define research objectives because well-defined objectives create clear links between your
research paper and the big, important question that motivates it. A clearly defined objective
directs a researcher in the right direction. In order to get the right solution a clearly defined
objectives are very important. Without clear objectives a researcher is aimless and
directionless in conducting the study.
Objectives of present study:
 Improve the ease of conducting card/digital transactions for an individual.

 Reduce the risks and costs of handling cash at the individual level.
 Reduce costs of managing cash in the economy.
 Build a transaction history to enable improved credit access and financial inclusion.
 Reduce tax avoidance.
 Reduce the impact of counterfeit money.
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2.2 METHODS OF DATA COLLECTION:
Data collection is the process of gathering and measuring information on variables of interest, in an
established systematic fashion that enables one to answer started research questions, test hypothesis,
and evaluate outcomes. The data collection components of research are common to all fields of
study including physical and social science, humanities, business, etc. Data collection is one of the
most important stages in conducting research. Data collection starts with determining what kind of
data required followed by the selection of a sample.
There are two types of data collection:
 Primary data
 Secondary data
1. Primary data:
Primary Data that has been collected from first-hand-experience is known as primary data.
Primary data has not been published yet and is more reliable, authentic and objective.
Primary data has not been changed or altered by human beings; therefore, its validity is
greater than secondary data. Sources of Primary Data: Sources for primary data are limited
and at times it becomes difficult to obtain data from primary source because of either
scarcity of population or lack of cooperation. Following are some of the sources of primary
data.
 Interview:
Interview is a face-to-face conversation with the respondent. In interview the main problem
arises when the respondent deliberately hides information otherwise it is an in-depth source of
information. The interviewer can not only record the statements the interviewee speaks but he can
observe the body language, expressions and other reactions to the questions too. This enables the
interviewer to draw conclusions easily
 Questionnaire:
It is the most commonly used method in survey. Questionnaires are a list of questions either open-
ended or close-ended for which the respondents give answers. Questionnaire can be conducted via
telephone, mail, live in a public area, or in an institute, through electronic mail or through fax and
other methods.
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 Experiments: Experiments require an artificial or natural setting in which to perform logical

study to collect data. Experiments are more suitable for medicine, psychological studies,
nutrition and for other scientific studies. In experiments the experimenter has to keep control
over the influence of any extraneous variable on the results. Survey: Survey is most
commonly used method in social sciences, management, marketing and psychology to some
extent. Surveys can be conducted in different methods.
 Observations:
Observation can be done while letting the observing person know that s/he is being
observed or without letting him know. Observations can also be made in natural settings as
well as in artificially created environment.
2. Secondary data:
Secondary Data collected from a source that has already been published in any form is
called as secondary data. The review of literature in any research is based on secondary
data. It is collected by someone else for some other purpose. For examples, Census data
being used to analyze the impact of education on career choice and earning. Common
sources of secondary data for social science include censuses, organizational records and
data collected through qualitative methodologies or qualitative research. Secondary data
is essential, since it is impossible to conduct a new survey that can adequately capture
past change and/or developments. Sources of Secondary Data: The following are some
ways of collecting secondary data:
• Books
• Records
• Biographies
• Newspapers
• Published censuses or other statistical data
• Data archives
• Internet articles
• Research articles by other researchers (journals)
• Databases, etc.
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 Present Study:
For the present study secondary data was collected through various sources which include various
books, journals, periodicals, magazines, reports and various web sources.
For the present study data was also collected through primary source. The primary source includes
collecting responses through a pre-designed questionnaire from people.
2.3 SAMPLING PLAN:
In research terms a sample is a group of people, objects, or items that are taken from a larger
population for measurement. The sample should be representative of the population to ensure that
we can generalize the findings from the research sample to the population as a whole.
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2.3.1 Sampling methods:
1. Simple random sampling:

In this case each individual is chosen entirely by chance and each member of the
population has an equal chance, or probability, of being selected.
2. Systematic sampling:
Individuals are selected at regular intervals from the sampling frame. The intervals
are chosen to ensure an adequate sample size.
3. Stratified sampling:
In this method, the population is first divided into subgroups who all share a similar
characteristic. It is used when we might reasonably expect the measurement of
interest to vary between the different subgroups, and we want to ensure
representation from all the subgroups.
4. Clustered sampling:
In a clustered sample, subgroups of the population are used as the sampling unit,
rather than individuals.
5. Convenience sampling:
Convenience sampling is perhaps the easiest method of sampling, because
participants are selected based on availability and willingness to take part.
6. Quota sampling:
This method of sampling is often used by market researchers. Interviewers are given
a quota of subjects of a specified type to attempt to recruit.
7. Judgement sampling:
Also known as selective, or subjective, sampling, this technique relies on the
judgement of the researcher when choosing who to ask to participate.
8. Snowball sampling:
This method is commonly used in social when investigating hard-to-reach groups.
2.3.2 Sample Design:
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For the present study, Simple Random Sampling method was used to collect the data
from 50 people in the area of Badlapur.
2.4 Area of Study:
Badlapur is a city in Thane district, Maharashtra state, India. It is a part of the

Mumbai Metropolitan Region. Badlapur city is a group of 4 villages namely, Katrap,
Kulgaon, Badlapur, and Manjarli. Over a period of time, Badlapur has transformed into a
major residential area, comprising of various communities and people of different cadre.
Badlapur is typically known to Mumbai people as a week-end picnic spot, as it hosts two
major dams and few waterfalls appear during monsoon. Its proximity to Mumbai has
transformed Badlapur into one of the major residential zones. Although it is approx. 70 km
from Mumbai main city, is quiet surroundings, beautiful nature and somewhat cool
temperatures made it a place liked by many.
Badlapur has a Municipal Council which takes care of civic amenities and keep-up of the
city. Funds are generated essentially through property taxes. Maharashtra State Assembly
has two nominations from Badlapur.
Badlapur is well connected with Mumbai, Pune and Bhiwandi through rail and road
network. Nearest Airport is Mumbai International Airport (approx. 65 km). The best way to
get in is by Local Trains which ply round the clock between Badlapur and Mumbai.
Badlapur is famous for its quiet surroundings. One can immediately feel its proximity to
nature. Badlapur is divided into two East and West (divided by railway lines). West
Badlapur is where the old market is located. East Badlapur houses the town deity
‘gaondevi’.
Badlapur is one of the fast developing suburbs of Mumbai city and comes under the Thane
district. Due to high demand for property in Mumbai, there is much over-crowding and
space issue in the main city. As a result, Badlapur market has picked up well and many
working professionals in Mumbai suburbs have moved here.
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The Badlapur city is divided into 34 wards for which elections are held every 5 years. The
Badlapur Municipal Council has population of 174,226 of which 90,365 are males while
83,861 are females as per report released by Census India 2011. Literacy rate of Badlapur
city is 91.72% higher than state average of 82.34%. In Badlapur, male literacy is around
94.45% while female literacy rate is 88.80%.
24
CHAPTER 4: RESULTS
Table 4.1 Gender of Respondents
Gender Percentage
Male 44%
Female 56%
Total 100
Graph 4.1 Gender of Respondents
Gender
Male
44% Female
56%
In the present study, the male respondents contribute to 44% whereas, the female respondents
contribute to 56%.
25
Table 4.2 Age of Respondents
Gender Percentage
18-30 46%
31-40 30%
41-50 18%
51-60 6%
Total 100
Graph 4.2 Age of respondents
Age of Respondents
6%
18-30
18% 31-40
41-50
46% 51-60
30%
It is observed that, 46% of respondents belong to the age group of 18-30 years, 30% of respondents
belong to the age group of 31-40 years, 18% of respondents belong to the age group of 41-50 years,
6% of respondents belong to the age group 51-60 years.
26
There are some questions asked to respondents on Impact of Electronic Payment System on
consumers.
Have you ever made an electronic payment?
Sales
4%
Yes
No
96%
It is observed that, 96% of respondents have made electronic payment but 4% of respondents did
not make electronic payment yet.
27
If yes, the how often you made?
Sales
30% Sometimes
Daily
70%
It is observed that, 70% of respondents sometimes make electronic payment but 30% of
respondents make daily electronic payment.
28
Which method do you find easier?
Which method do you find easier ?
20%
Cash payment
Electronic payment
80%
It is observed that, 80% of respondents find the electronic payment method easier and 20% of
respondents find the cash payment method easier.
29
Do you think electronic payment system is risky?
Do you think electronic payment system is

risky ?
20% Yes
No
80%
It is observed that, 80% of respondents do not find the electronic payment system risky and 20% of
respondents find electronic payment system risky.
30
Do you think that using electronic payment system makes your life easier?
Do you think that using electronic payment

system makes your life easier?
8%
Yes
No
92%
It is observed that, 92% of respondents think that electronic payment system has made their life
easier but 8% of respondents do not think that electronic payment system has made their life easier.
31
If you buy a lot at market, do you make electronic payment?
If you buy a lot at market, do you make

electronic payment ?
14%
Yes
No
86%
It is observed that, 86% of respondents if buy a lot at market then they make electronic payment,
14% of respondents if buy a lot at market then they do not make electronic payment.
32
Do you think electronic payment system is secure in comparison of cash payment mode?
Do you think electronic payment system is

secure in comparison of cash payment
mode?
Yes
14%
No
86%
It is observed that, 86% of respondents think that electronic payment system is secure in
comparison of cash payment mode and 14% of respondents do not think that electronic payment
system is secure in comparison of cash payment mode.
33
How much you are satisfied with the electronic payment system?
How much you are satisfied with the

electronic payment system?
6%
Average satisfied
Fully satisfied
Not satisfied
39%
55%
It is observed that, 55% of respondents are average satisfied with the electronic payment system,
39% of respondents are fully satisfied with electronic payment system, 6% of respondents are not
satisfied.
34
Did you face any trouble during the use of electronic payment mode?
Did you face any trouble during the use of

electronic payment mode?
24% Yes
No
76%
It is observed that, 76% of respondents facing trouble during the use of electronic payment mode
but 24% of respondents not facing any trouble during the use of electronic payment mode.
35
Would you recommend the electronic payment method to your friends, family and
colleagues?
Would you recommend the electronic pay-

ment method to your friends, family and col-
leagues?
8% Yes
No
92%
It is observed that, 92% of respondents recommend the electronic payment method to their friends,
family and colleagues, 8% of respondents not recommend the electronic payment method to their
friends, family and colleagues.
36
CHAPTER 5: DISCUSSION
 Most of the respondents are having Saving A/CS.

 Most of the respondents are satisfied with the service offered by their Bank.
 Majority of the customers rates good, very good and excellent because of the customer
service offered by the bank
 People are now looking forward for better customer service in addition to the brand
name in which they are investing and the returns they are getting. That reason can be
increasing customer satisfaction and quality services offered by the bank.
 Most of the respondents who lies under the age of 21-30 are using E-banking services
as near about 40 respondents are using these services because under the age of these
respondents they are having more knowledge about the services of e-banking
 Most of respondent are business man are using E-banking services as near about 48
respondents are using E-banking services. Because the benefits which are having
while using these services more benefited by the business man people so they are
availing these services more than the other respondents.
 Among the overall percentage of the customers whose having their account in the
bank which we have conducted in our survey should be the 76% and they are using
the services of single bank.
 The overall percentage of businessmen having complete knowledge about E-banking
services provided by the bank while opening an account by a common people have
no awareness of e-banking services.
 Online Payment services provided in terms of ATMs, Debits Cards, Credits Cards,
Phone Banking, Mobile Banking, Internet Banking etc., of which the first six have
been covered. Amongst these Debits Card scores the largest used services status
(38%), Net Banking (24%), Phone Banking (20 %).
37
 A study of factors, influencing the usage was made by listing out various factors
such as all-time availability, ease of use, nearness etc., and amongst the various
factors status symbol is ranked as the major motivating factor, followed by all time
availability, friends, ease of use and direct access in decreasing order of importance.
Quite interestingly, security symbol scored the least motivating factors.
 When asked to list various benefits accruing from the usage of e-banking, time
saving. The other benefits accruing to the people include ready availability of funds
removal of middlemen and no rude customer relation executives.
 Among the users, various problems that are encountered while using e-banking
services. Firstly, they highly considered difficulty is claiming false transactions are
the objectives were surveying.
 The literature reviewed from various papers suggests that digital payment is far more
convenient compare to traditional medium of paper currency. This method of payment is
24x7 available from anywhere. Such payment transaction can be done by any individual
who possess internet connection and they don’t need to wait in queue or visit banks.
 As we know how important time is, in everyone’s life, so the most important part played by
the digital payment system is that saves a lot of time and its far safer compare to cash
handling. If we look at this type of payment it helps us to pay the exact amount to the
person whom we are paying sometimes we are short of change as well as the person whom
we are supposed to pay so maybe in the long run if that change is not exchanged either of
the person is benefiting but if digital payment is used nothing as such will take place.
 It has also been seen that post demonetization it had made a great impact in a country like
India where huge share of the population starting using the digital payment system sue to
shortage in paper currency and to save time. As we know the government took an initiative
to make India a cashless country which post demonetization should some positivity and we
can also see during this crisis i.e., due to Covid-19 we all are making most use of the digital
payment system, all e-commerce or all online grocery or other necessity online commerce
are not accepting cash, all are accepting prepaid payment which can be done through
various digital payment system.
38
 So, the paper reviewed is from all across the world where the authors have put their opinion
and most of the paper are analyzed through data collected from customers, businessmen,
organization, etc. As per the data collected by the authors, they have analyzed the result and
interpreted using various tests. Most of the paper suggests that the people are using and
accepting the digital payment system due to convenience in handling it, some suggest as
they get rewards or cash back, they save time and it’s a faster mode of transaction and so
on.
39
CHAPTER 6: CONCLUSION
Variables that influence consumer’s commitment towards e-payment systems include quality,
trust, perceived ease of use, perceived usefulness and satisfaction. The research findings
indicate potential customers’ satisfaction levels of e-payment usage whether
they are ready for the adoption of changed lifestyle and, if not, what encourages and
discourages them from usage of e-payments. Therefore, necessary strategies to implement are
proposed, along with approaches they can be used to enhance e-payment environment.
Digital payments not only helps individual to payments or receive money it also performs
multiple functions such as giving reminder about dues of any kind of payments to be made, it
gives various offers to the user and its saves a lot of time, as per the initiative taken by the
government of India to make a digital India and due to the increase in smartphone selling and
availability of internet at a high speed and at an affordable price this is one of the core factors
for consumers to adopt the digital payment system as
everything can be done at our finger tips and we don’t need to go anywhere to use it. In the
near future there will be more increment in the usage of digital payment system and definitely
the digital India mission will be highly successful. This study attempts to identify key quality
attributes of internet banking services (ONLINE PAYMENT SERVICES) by analyzing
internet banking customer and their comments on banking experience. The finding of this
study shows that despite of many advantages of online banking. The findings of this study
show that despite of many advantages of online banking. People still consider it as an
alternative for analyzing their banking records. Although every bank today provides the
facility of online banking but most of the people use it only once a month. This reason is that
in case of internet banking interpersonal interaction with customer is seldom possible.
Identification and measurement of customer’s experience of the internet banking services
provide a frame of reference and their related quality dimension. The main factors which
persuade people to use online banking are comported & convenience and the facility which
attracts them most is quality and quantity of information. Therefore, the implementation of
quality initiative should be with defining
customer’s need and preference and their related quality dimension. There is still a lot
needed for the banking system to make reforms and train their customers for using
internet for their banking account. Going through the survey the main problem lies
that still customer have a fear of hacking of accounts and thus do not on for internet
banking. Banks are trying their level best by providing the best security options to the
40
customer from opening an internet bank account. Bank are providing free internet banking
services also so that the customer can be attracted. By asking the bank employ we came to
know that maximum numbers of internet bank account holders are youth and business man. E-
Banking is an innovative tool that is fast becoming a necessity it is a successful strategic we
upon for banks to remain profitable in a volatile and competitive marketplace of today. If
proper training should be given to customer by the bank employs to open an account will be
beneficial secondly the website should be made friendlier from where the first-time customers
can directly make and access their account. It helped me in studying satisfaction about services
and products offered to consumers.
Since the opening up of the banking sector, private banks are in the fray each one
trying to cover more market share than the other. I am sure the bank will find my findings
relevant and I sincerely hope it uses my suggestion se n listed, which I hope will take them
miles ahead of competition. In short, I would like to say that the very act of the concerned
management at OBC in giving me the job of critically examining consumer satisfaction
towards financial products and services of the company is a step in their continual mission of
making all round improvements as a means of progress.
41
CHAPTER 7: BIBLIOGRAPHY/REFERENCES
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liability and consumer trust in electronic commerce transactions. Logistics
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 Hsieh, C. E-commerce payment systems: critical issues and management
strategies. Human Systems Management, 20, 2001, 131–138.
 Peha, J. M., and Khamitov, I. M. PayCash: a secure efficient internet payment
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International Journal of Information Technology and Decision Making, 2, 3,
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 Mukherjee, A., and Nath, P. A model of trust in online relationship banking.
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from the customer viewpoint. In Proceedings of the 14th European Conference
on Information Systems (ECIS 2006), Goteborg, Schweden, 2006, 1–11.
 Kousaridas, A., Parissis, G., and Apostolopoulos, T. An open financial
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systems through the analytic hierarchy process. Journal of Business Research,
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Germany: a classificatory framework and empirical evidence. Journal of
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 Adeoti, O. & Osotimehin, K. (2012). Adoption of Point of Sale Terminals in Nigeria:
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45
CHAPTER 8: APPENDICES
QUESTIONNAIRE
1. Name*
2. Gender
o Male
o Female
o Prefer not to say
3. Age
o 18-30
o 31-40
o 41-50
o 50-60
o Above 60
4. Have you ever made an electronic payment?

o Yes
o No
5. If yes, then how often you made?

o Sometimes
o Daily
6. Which method do you find easier?

o Cash payment
o Electronic payment
7. Do you think electronic payment system is risky?

o Yes
46
o No
8. Do you think that using electronic payment system makes your life easier?
o Yes
o No
9. If you buy a lot at market, do you make electronic payment?

o Yes
o No
10. Do you think electronic payment system is secure in comparison of cash payment
mode?
o Yes
o No
11. How much you are satisfied with the electronic payment system?
o Average satisfied
o Fully satisfied
o Not satisfied
12. Did you face any trouble during the use of electronic payment mode?
o Yes
o No
13. Would you recommend the electronic payment method to your friends, family and
colleagues?
o Yes
o No
47

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A Study on Impact of E-Payment System on Consumers

1.2 THE EVOLUTION OF ELECTRONIC PAYMENT SYSTEM:

1.3Types of Electronic Payment System:

1.4 Benefits of Electronic Payment System:

2. Higher payment security:

3. Better customer convenience:

4. Saves processing costs:

5. Low risk of theft:

1.5Advantages of Electronic Payment System:

1.6Disadvantages of Electronic Payment System:

1.7 Techniques of Electronic Payment System:

o National Electronic Funds Transfer System (NEFT):

o Card based clearing (CBC):

o Real-time gross settlement (RTGS):

CHAPTER 2: REVIEW OF LITERATURE

CHAPTER 3: RESEARCH METHEDOLOGY

2.1 Objectives of Research:

Objectives of present study:

 Improve the ease of conducting card/digital transactions for an individual.

2.2 METHODS OF DATA COLLECTION:

There are two types of data collection:

 Experiments: Experiments require an artificial or natural setting in which to perform logical

• Published censuses or other statistical data

• Research articles by other researchers (journals)

2.3 SAMPLING PLAN:

2.3.1 Sampling methods:

1. Simple random sampling:

2.3.2 Sample Design:

2.4 Area of Study:

Badlapur is a city in Thane district, Maharashtra state, India. It is a part of the

Table 4.1 Gender of Respondents

Graph 4.1 Gender of Respondents

Table 4.2 Age of Respondents

Graph 4.2 Age of respondents

Have you ever made an electronic payment?

If yes, the how often you made?

Which method do you find easier?

Which method do you find easier ?

Do you think electronic payment system is risky?

Do you think electronic payment system is

Do you think that using electronic payment

If you buy a lot at market, do you make electronic payment?

If you buy a lot at market, do you make

Do you think electronic payment system is

How much you are satisfied with the

Did you face any trouble during the use of

Would you recommend the electronic pay-

 Most of the respondents are having Saving A/CS.

increasing customer satisfaction and quality services offered by the bank.

availing these services more than the other respondents.

the services of single bank.

 The overall percentage of businessmen having complete knowledge about E-banking

no awareness of e-banking services.

(38%), Net Banking (24%), Phone Banking (20 %).

Quite interestingly, security symbol scored the least motivating factors.

removal of middlemen and no rude customer relation executives.

the objectives were surveying.

 Chellappa, R., and Pavlou, P. Perceived information security, financial

 Ahmi.A et.al. (2015),” Adoption of e-Payment Systems: A Review of Literature”.