Electronic money (smart card), The Alternative Way of Paper Money

Abstract:

Everyday life has suburbanized by the modern technologies and money is not exclusion. The conventional ways of the monetary exchange has improved into electronic ones. Tonight electronic money has become progressively fashionable among people and around the globe.

But some implementation of e-money e.g. credit card is not so efficient because it requires an extra machine to read the card. If we can make a system embedded which will not require a machine to read. . Inside the system there will be a microprocessor and other necessary mechanism to transaction. To provide security we will propose a biometric mechanism.

Introduction:

Electronic money, or e-money, is the money balance recorded electronically on a stored-value card. Progressively, People are using computer networks and spend for goods and services with electronic money. In 1983, a research paper by David Chaum introduced the idea of digital cash [4]. Every day we face the retail money problem. In an electronic payment system a user can reduce the problem of the retail money. Every user must bear a small weightless card which will be made with his/her NID. When need to purchase something, just give the finger print and the enter the amount to transact. For the security purpose user can track the card using the mobile phone. For renewing the smart card user need to submit NID and then will get a new one according to the old serial number. By implementing the new system, we need some time to cope with the people. We need to show them the importance of smart card. We may need to provide some training to use the system. Once the people came to the agreement of using the system they will highly beneficial.

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Literature Review:

Today we live in an era where various technologies are used to serve the mankind. In 1997, Aleksander Berentsen from university of Bern analyzed about monetary policy implications of digital money. He talked about the bespeak of the electronic money, its diagnostic procedure and monetary control mechanism. According to the paper, electronic money generally two types. First one is network money and second one is smart card. Also says that the implementation of the electronic money can hydrolyze the central bank [1].

In Bangladesh there are some implementations of e-money which are:

1. Bkash

Bangladesh’s initial accomplished mobile financial service provider, bKash Limited, a BRAC Bank supplementary, started its mobile banking activities in July 2011[6]. BKash was fashioned to yield fiscal services via mobile phones to the mankind of Bangladesh.