Payroll debit cards are issued to employees by employers in lieu of checks or direct deposit. These are for employees without bank accounts. It allows them to make online payments, use the card as a credit card or debit card, and allows for cash access from an ATM.Smart cards are a combination of credit cards, debit cards, phone cards, driver's license cards, and more. Smart cards replace the typical magnetic strip on a credit or debit card with a microprocessor. Merchant's can access the card's information to check the card's authenticity and spending limits. The dollar amount of the transaction is then debited to the card. Some smart cards have embedded radio-frequency antennae that make it possible to access buildings and secure areas within buildings, as well as buy gas and fast food. Students are using smart cards to open locked doors to dorms and identify themselves to retailers near campus and on the Internet. They also serve as ATM cards.For many, the ultimate convenience in banking involves automatic transactions such as direct deposit and direct payments. A direct deposit is a credit made directly to a checking or savings account. Many employees have their paycheck automatically deposited to their checking account.A direct payment is a pre-authorized electronic payment. Customers sign a separate authorization form for each company they would like to pay automatically. This form authorizes the designated company to collect funds for the amount of the bill from the customer's account.AACSB: Reflective ThinkingBlooms: ApplicationLearning Goal: 20-6Level of Learning 3: Application of principlesNickels - Chapter 20 #326Topic: Using Technology to Make Banking More Efficient110
Mini-CaseThe Bank of Bramblewood survived the Great Depression through the dedication, hard work, and conservative practices of its first president, Red E. Kash. Indeed, Red's personal drive and business skills helped the Bank of Bramblewood thrive during his 50-year tenure as president. After his retirement his granddaughter, Patty, took a position with the bank. Patty inherited her grandfather's business skills and by 1994 she had risen to become the second member of the Kash family to head the bank.Patty admits she owes a great deal to her grandfather's leadership and advice, but she also quickly points out that the banking industry has changed significantly since Red retired. Patty graduated from college with a degree in finance, and also holds several certifications with the American Institute of Banking. "What Granddad achieved during his era was truly remarkable," Patty points out. "But times have changed, and banking regulations and bank competitors have certainly changed. If we hope to prosper in this century we have to adjust to new competition, learn to work with new technologies, and take advantage of new opportunities. The Bank of Bramblewood has always operated for the benefit of our customers and we will continue to do so. But we must serve them more efficiently and creatively than in the past."
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