Payment Systems
Overview
- Token Based
- payment that occurs when the payor gives the payee a physical item, or token, that represents payment.
The common example is the exchange of currency. Token based systems require the payee to be able to
verify that the token given them is valid, and to accept it as payment. Token payments are anonymous.
- Account Based
- an account based system is one where a third party (such as a bank) maintains an account for its customers,
such that when they pay another individual, the third party will execute payment and debit the customers account.
Account based payments require some degree of verification of the identity of the payor.
- Credit
- in the case of credit, no payment is exchanged. The transaction is executed on credit, which
is
contract
between the parties
guaranteeing payment at some later date.
Topics