Facilitating transactions

Bitcoins are stored in a “digital wallet,” which exists either in the cloud or on a user’s computer. The wallet is a kind of virtual bank account that allows users to send or receive bitcoins, pay for goods or save their money

Cards be it a credit or a debit has almost become a compulsory item in the wallet of any individual. The convenience of carrying, fast and easy way of transaction, issues of safety and security are couple of winning points which are driving us to gradually come out of cash. The evolution of e-commerce economy is also in the rise. The popularity of sites  like Amazon or e-Bay globally has also enabled local entrepreneurs to launch e-commerce sites in Bangladesh. Mobile banking (digital transactions through using mobile) has gained significant momentum in terms of volume of transactions is really notable. The innovation in this field is like at the speed of light! Not only the customers or sellers who are benefitting from this innovation but this is also helping increase the volatility of money helping increase in supply. This acts like a tonic for the growth of overall economy. We are witnessing innovation in the global market keeping the ultimate consumer satisfaction. Terms like Bitcoin and Blockchain are getting more familiarity.

The way we pay is changing dramatically. For example, people are beginning to use their smartphones for every kind of formal and informal transaction — to shop at stores, buy songs online, and even split their rent. At the heart of these changes in how we pay are thousands of companies competing and collaborating to facilitate transactions. To understand why the payments industry has faced so much disruption in such a short time, there's just one key thing to understand: Payments is about transferring information from one party to another, and nearly every stakeholder in the industry benefits when that process runs on digital rails.But payments is also an extremely complex industry that few fully understand. Digital  currency can be defined as an Internet-based form of currency or medium of exchange distinct from physical (such as banknotes and coins) that exhibits properties similar to physical currencies, but allows for instantaneous transactions and borderless transfer-of-ownership. Both virtual currencies  are types of digital currencies. According to the Bank For Interna­tional Settlements' "Digital currencies" report of November 2015, digital currency is an asset represented in digital form and having some monetary characteristics. Digital currency can be denominated to a sovereign currency and issued by the issuer responsible to redeem digital money for cash. In that case, digital currency represents electronic money (e-money). Digital currency denominated in its own units of value or with decentralized or automatic issuance will be considered as a virtual currency. The recent development in the industry  can be summarised as follows, 
•  2016 will be a watershed year for the payments industry. Payments companies are improving security, expanding their mobile offerings, and building commerce capabilities that will give consumers a more compelling reason to make purchases using digital devices. 
• Payments is an extremely complex industry. To understand the next big digital opportunity lies, it's critical to understand how the traditional credit- and debit-processing chain works and what roles acquirers, processors, issuing banks, card networks, independent sales organizations, gateways, and software and hardware providers play. 
•  Alternative technologies could disrupt the processing ecosystem. Devices ranging from refrigerators to smartwatches now feature payment capabilities, which will spur changes in consumer payment behaviors. Likewise, blockchain technology, the protocol that underlies Bitcoin, could one day change how consumer card payments are verified.
Bitcoins are stored in a “digital wallet,” which exists either in the cloud or on a user’s computer. The wallet is a kind of virtual bank account that allows users to send or receive bitcoins, pay for goods or save their money.
Bitcoin is a new currency that was created in 2009 by an unknown person using the alias Satoshi Nakamoto. Transactions are made with no middle men – meaning, no banks! There are no transaction fees and no need to give your real name. More merchants are beginning to accept them: You can buy web hosting services, pizza or even manicures.Bitcoins can be used to buy merchandise anonymously. In addition, international payments are easy and cheap because bitcoins are not tied to any country or subject to regulation. Small businesses may like them because there are no credit card fees. Some people just buy bitcoins as an investment, hoping that they’ll go up in value. Several marketplaces called “bitcoin exchanges” allow people to buy or sell bitcoins using different currencies. Mt. Gox is the largest bitcoin exchange. People compete to “mine” bitcoins using computers to solve complex math puzzles. This is how bitcoins are created. Currently, a winner is rewarded with 25 bitcoins roughly every 10 minutes.Though each bitcoin transaction is recorded in a public log, names of buyers and sellers are never revealed – only their wallet IDs. While that keeps bitcoin users’ transactions private, it also lets them buy or sell anything without easily tracing it back to them. That’s why it has become the currency of choice for people online buying drugs or other illicit activities.
The recent heist which took place from the central bank reserve, the various skims related to card payments and ATMs, the breaches in digital payment system (Bikash) are couple of examples that show how important is the human interface is critical to ensure the security system in place. The architecture needs to be robust and continuous improvement is key to success in the payment system. 

The writer, a banker by profession, has worked both in local and overseas market with various foreign and local banks in different positions

Facilitating transactions

Bitcoins are stored in a “digital wallet,” which exists either in the cloud or on a users computer. The wallet is a kind of virtual bank account that allows users to send or receive bitcoins, pay for goods or save their money

Cards be it a credit or a debit has almost become a compulsory item in the wallet of any individual. The convenience of carrying, fast and easy way of transaction, issues of safety and security are couple of winning points which are driving us to gradually come out of cash. The evolution of e-commerce economy is also in the rise. The popularity of sites like Amazon or e-Bay globally has also enabled local entrepreneurs to launch e-commerce sites in Bangladesh. Mobile banking (digital transactions through using mobile) has gained significant momentum in terms of volume of transactions is really notable. The innovation in this field is like at the speed of light! Not only the customers or sellers who are benefitting from this innovation but this is also helping increase the volatility of money helping increase in supply. This acts like a tonic for the growth of overall economy. We are witnessing innovation in the global market keeping the ultimate consumer satisfaction. Terms like Bitcoin and Blockchain are getting more familiarity. The way we pay is changing dramatically. For example, people are beginning to use their smartphones for every kind of formal and informal transaction to shop at stores, buy songs online, and even split their rent. At the heart of these changes in how we pay are thousands of companies competing and collaborating to facilitate transactions. To understand why the payments industry has faced so much disruption in such a short time, theres just one key thing to understand: Payments is about transferring information from one party to another, and nearly every stakeholder in the industry benefits when that process runs on digital rails.But payments is also an extremely complex industry that few fully understand. Digital currency can be defined as an Internet-based form of currency or medium of exchange distinct from physical (such as banknotes and coins) that exhibits properties similar to physical currencies, but allows for instantaneous transactions and borderless transfer-of-ownership. Both virtual currencies are types of digital currencies. According to the Bank For International Settlements Digital currencies report of November 2015, digital currency is an asset represented in digital form and having some monetary characteristics. Digital currency can be denominated to a sovereign currency and issued by the issuer responsible to redeem digital money for cash. In that case, digital currency represents electronic money (e-money). Digital currency denominated in its own units of value or with decentralized or automatic issuance will be considered as a virtual currency. The recent development in the industry can be summarised as follows, 2016 will be a watershed year for the payments industry. Payments companies are improving security, expanding their mobile offerings, and building commerce capabilities that will give consumers a more compelling reason to make purchases using digital devices. Payments is an extremely complex industry. To understand the next big digital opportunity lies, its critical to understand how the traditional credit- and debit-processing chain works and what roles acquirers, processors, issuing banks, card networks, independent sales organizations, gateways, and software and hardware providers play. Alternative technologies could disrupt the processing ecosystem. Devices ranging from refrigerators to smartwatches now feature payment capabilities, which will spur changes in consumer payment behaviors. Likewise, blockchain technology, the protocol that underlies Bitcoin, could one day change how consumer card payments are verified. Bitcoins are stored in a digital wallet, which exists either in the cloud or on a users computer. The wallet is a kind of virtual bank account that allows users to send or receive bitcoins, pay for goods or save their money. Bitcoin is a new currency that was created in 2009 by an unknown person using the alias Satoshi Nakamoto. Transactions are made with no middle men meaning, no banks! There are no transaction fees and no need to give your real name. More merchants are beginning to accept them: You can buy web hosting services, pizza or even manicures.Bitcoins can be used to buy merchandise anonymously. In addition, international payments are easy and cheap because bitcoins are not tied to any country or subject to regulation. Small businesses may like them because there are no credit card fees. Some people just buy bitcoins as an investment, hoping that theyll go up in value. Several marketplaces called bitcoin exchanges allow people to buy or sell bitcoins using different currencies. Mt. Gox is the largest bitcoin exchange. People compete to mine bitcoins using computers to solve complex math puzzles. This is how bitcoins are created. Currently, a winner is rewarded with 25 bitcoins roughly every 10 minutes.Though each bitcoin transaction is recorded in a public log, names of buyers and sellers are never revealed only their wallet IDs. While that keeps bitcoin users transactions private, it also lets them buy or sell anything without easily tracing it back to them. Thats why it has become the currency of choice for people online buying drugs or other illicit activities. The recent heist which took place from the central bank reserve, the various skims related to card payments and ATMs, the breaches in digital payment system (Bikash) are couple of examples that show how important is the human interface is critical to ensure the security system in place. The architecture needs to be robust and continuous improvement is key to success in the payment system. The writer, a banker by profession, has worked both in local andoverseas market with various foreign and local banks in different positions