Banking Awareness : What is EFT Payment ?

If you are preparing for any banking sector exams either it be IBPS PO, IBPS Clerk, SBI PO etc., you will come across Banking Awareness Section under which question are asked based on What is EFT Payment ?

When we deal about EFT, the first question that arises in our mind is :

What does EFT stand for ?

or

What is EFT full form ?

The answer to it is EFT stands for Electronic Funds Transfer.

Now, the next question that arises in our mind is :

What is EFT ?

or

What is EFT meaning ?

or

What is EFT definition ?

The answer to it is EFT or Electronic Funds Transfer is a method to transfer fund ( money ) from one account to another either within the same financial institutions or two different financial institution, electronically over a computerized network.

EFT Payment are regulated by electronic funds transfer act.

The Electronic Funds Transfer Act is a federal law that protects consumers engaged in the transfers via electronic methods.

In 1995, the Reserve Bank had set up the Committee for Proposing Legislation on Electronic Funds Transfer and other Electronic Payments. 

Chairperson : Smt. K.S.Shere 

The Shere Committee had recommended a set of EFT Regulations by the Reserve Bank under the Reserve Bank of India Act,1934 and amendment to the Bankers’ Books Evidence Act,1881 as short term measures and promotion of a few Acts like the Electronic Funds Transfer Act, the Computer Misuse and Data Protection Act etc. as long term measures.

However, there is still a need for a separate Act for Electronic Funds Transfer because certain transaction issues like payments finality, rights and obligations of the parties involved in electronic funds transfer etc. cannot be covered in general purpose bills like the proposed Information Technology Bill or the proposed Electronic Commerce Bill. 

The EFT Regulations being framed by the Reserve Bank would address only the specific type of EFT system that the Reserve Bank would be involved with as a service provider as also a regulator. 

The EFT Regulations would, moreover, cover only credit transfer related transactions and not Debit Clearing transactions. 

A separate legislation on the lines of Electronic Funds Transfer Act of USA is, therefore, required which would be consumer protection oriented and would at the same time address transaction issues like execution of payment order, settlement finality, etc.

Later, after a careful examination of the issue, the committee formed by RBI has endorsed the view that the proposed Electronic Funds Transfer Act should cover all forms of electronic payments.

At last, A special thanks to choose LOUD STUDY.

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