Mode of Payments
In the most basic sense, a payment is the exchange of money, or exchange items of value between parties.
According to Wikipedia, a payment system on the other hand is regarded as a “system” because it employs methods to substitute physical money for items such as cheques and letters of credits. In recent years, the electronic information age has led to the development of a vast number of new electronic payment methods that include electronic banking cards, electronic fund transfer systems and direct transfers, and internet / mobile payment systems.
How did we get here?
Payments and resulting Payment Systems have evolved through the history of the human race, starting out at the most primitive level of a simple exchange of goods, or barter.
The Barter
Bartering is thought to date back over 100,000 years, and was seen across practically every culture. Farmers might trade livestock for clothing, or someone skilled in weaving might trade one of his baskets so he’ll have something to put in one of his other baskets. The transactions were usually completed by two people and the amounts were determined almost solely on what each party agreed would be a fair exchange.
But bartering presented the issue of the size of items – it was not exactly an easy job of putting a cow or two in your rucksack for exchange for wheat from your neighbour a couple of days’ worth of travel away. There was a strong need for an easier way to purchase items.
Early Commodity Money
Commodity money evolved out of bartering, and is based around the idea that the commodity itself has a specific value to it. The earliest examples of commodity money include dyes, strung beads, and shell jewellery. In fact, the term Shekel, which is still used today, originally referred to a specific mass of barley and dates in Mesopotamia right around 3000 BC. Probably the most famous form of commodity money is gold, which was swapped by the Egyptians in bar-form and has frequently taken on
According to Wikipedia, a payment system on the other hand is regarded as a “system” because it employs methods to substitute physical money for items such as cheques and letters of credits. In recent years, the electronic information age has led to the development of a vast number of new electronic payment methods that include electronic banking cards, electronic fund transfer systems and direct transfers, and internet / mobile payment systems.
How did we get here?
Payments and resulting Payment Systems have evolved through the history of the human race, starting out at the most primitive level of a simple exchange of goods, or barter.
The Barter
Bartering is thought to date back over 100,000 years, and was seen across practically every culture. Farmers might trade livestock for clothing, or someone skilled in weaving might trade one of his baskets so he’ll have something to put in one of his other baskets. The transactions were usually completed by two people and the amounts were determined almost solely on what each party agreed would be a fair exchange.
But bartering presented the issue of the size of items – it was not exactly an easy job of putting a cow or two in your rucksack for exchange for wheat from your neighbour a couple of days’ worth of travel away. There was a strong need for an easier way to purchase items.
Early Commodity Money
Commodity money evolved out of bartering, and is based around the idea that the commodity itself has a specific value to it. The earliest examples of commodity money include dyes, strung beads, and shell jewellery. In fact, the term Shekel, which is still used today, originally referred to a specific mass of barley and dates in Mesopotamia right around 3000 BC. Probably the most famous form of commodity money is gold, which was swapped by the Egyptians in bar-form and has frequently taken on