In which of the following payment mode, the payer creates payment transfer instructions, signs it digitally and sends it to issuer?
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A. B. C. D.C.
Electronic systems are simplest of three payment models.
The payer simply creates a payment transfer instructions, sign it digitally and send it to issuer.
The issuer then verifies the signature on the request and performs the transfer.
This type of systems requires payer to be on-line and not payee.
For CISA exam you should know below information about payment systems There are two types of parties involved in all payment systems " the issuer and the user.
An issuer is an entity that operates the payment service.
An issuer holds the items that the payment represents.
The user of the payment service performs two main functions " making payments and receiving payments " and therefore can be described as a payer or payee receptively.
Electronic Money Model " The objective of electronic money systems is emulating physical cash.
An issuer attempts to do this by creating digital certificates, which are then purchased by users who redeem them with the issuer at a later date.
In the interim, certificates can be transferred among users to trade for goods or services.
For the certificate to take on some of the attributes of physical cash, certain techniques are used so that when a certificate is deposited, the issuer can not determine the original withdrawer of the certificate.
This provides an electronic certificate with unconditional uncertainty.
Electronic Check Model " Electronic check system model real-world checks quite well and thus relatively simple to understand and implement.
A users write an electronic check, which is digitally signed instruction to pay.
This is transferred to another user, who then deposits the electronic check with the issuer.
The issuer will verify payer's signature on the payment and transfer the fund from the payer's account to the payee's account.
Electronic Transfer Model " Electronic systems are simplest of three payment models.
The payer simply creates a payment transfer instructions, sign it digitally and send it to issuer.
The issuer then verifies the signature on the request and performs the transfer.
This type of systems requires payer to be on-line and not payee.
The following were incorrect answers: Electronic Money Model " The objective of electronic money systems is emulating physical cash.
An issuer attempts to do this by creating digital certificates, which are then purchased by users who redeem them with the issuer at a later date.
In the interim, certificates can be transferred among users to trade for goods or services.
For the certificate to take on some of the attributes of physical cash, certain techniques are used so that when a certificate is deposited, the issuer can not determine the original withdrawer of the certificate.
This provides an electronic certificate with unconditional uncertainty.
Electronic Check Model " Electronic check system model real-world checks quite well and thus relatively simple to understand and implement.
A users write an electronic check, which is digitally signed instruction to pay.
This is transferred to another user, who then deposits the electronic check with the issuer.
The issuer will verify payer's signature on the payment and transfer the fund from the payer's account to the payee's account.
Electronic Withdraw Model " Not a valid type of payment system.
The payment mode in which the payer creates payment transfer instructions, signs it digitally and sends it to the issuer is the Electronic Money Model, also known as the E-money model.
In this model, electronic money or e-money is a form of digital currency that can be stored on an electronic device, such as a mobile phone or smart card, and can be used to make payments. The payer creates payment transfer instructions, signs it digitally and sends it to the issuer who then transfers the electronic money from the payer's account to the payee's account.
This model is commonly used for small transactions, such as buying a cup of coffee or a bus ticket, and offers several advantages over traditional payment methods, such as speed, convenience, and security.
Electronic Checks Model, on the other hand, is a payment mode where electronic checks or e-checks are used to make payments. E-checks are digital versions of paper checks and are processed through the Automated Clearing House (ACH) network.
The Electronic Transfer Model involves the electronic transfer of funds between two bank accounts, either domestically or internationally.
The Electronic Withdraw Model allows customers to withdraw money from their bank account using an ATM or other electronic means.
In summary, the payment mode in which the payer creates payment transfer instructions, signs it digitally and sends it to the issuer is the Electronic Money Model.