1. Take Charge of Your Finances
Electronic Banking
Take Charge of Your Finances
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

2. Electronic Funds Transfer (EFT)
Electronic Banking
Electronic Funds Transfer (EFT)
The electronic movement of money that allows electronic banking to be accomplished
What can be done?
Withdrawals
Bill Payment
Deposits
Through what methods?
Phone
Computer
Automated Teller Machine (ATM)
Point of Sale Terminal (POS)
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

3. Electronic Banking Benefits of e-banking include: 24 hour access
Fast transactions
Paperless transactions
Convenience
Worldwide access
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

4. Debit Cards Debit Cards – Plastic cards, which look like credit cards,
Electronically connected to a card holder’s depository institution account
Money is automatically withdrawn from the designated account
For added protection:
Sign the back of a debit card with
Your signature and
“see id”
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

5. Personal Identification Numbers
Debit cards require the use of PIN (Personal Identification numbers)
This number is entered at
Automated Teller Machine (ATM) or
Point of Sale Terminal (POS)
This confirms that the individual is authorized to access that particular account
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

6. Consumer Liability
According to the Federal Trade Commission, a consumer is held liable for any unauthorized charges under the following conditions:
If the depository institution within two business days:
The consumer is held responsible for no more then $50
If the institution is not notified within the first two business days, but within the first 60 days:
The consumer is held liable for no more then $500
If the institution is notified after the first 60 days:
The consumer is held liable for no more than the amount of the unauthorized transfers
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

7. Automated Teller Machines
Automated Teller Machines (ATM’s) - electronic computer terminals which offer automated, computerized banking
Transactions allowed may include:
Deposits
Cash withdrawals
Transfers between accounts
Account balance information
Some ATMs may only allow cash withdrawals
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

8. ATMs continued ATMs can be found at various places including:
depository institutions
supermarkets
convenience stores
ATMs are accessed with an ATM or debit card and a PIN
Fees may be charged for ATM use, but will vary depending on the particular depository institution
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

9. Point of Sale Terminal
Point of Sale Terminal (POS), is located at stores and allows the customer to use a debit card to make a purchase
At participating POS terminals customers may request additional cash back
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

10. Point of Sale Terminal Transactions
A debit card’s magnetic strip is swiped through the POS
After the required PIN is provided, the transaction is authorized
If the purchase is under $25.00 a signature may not be required

11. Direct Deposit & Payment
Paychecks and benefit checks are directly deposited into a specified depository institution account
Direct Payment - authorizes bills to be paid by a specific depository institution account
This can be done for fixed and flexible expenses. Examples include:
Mortgages, vehicle payments, phone bill
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

12. Direct Payment & Deposit
An authorization form is signed to allow the transaction to occur
Consumers are responsible for frequently checking their account to ensure that the correct amount was withdrawn or deposited
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

13. Payroll Cards
Offer an alternative to printing and mailing a paycheck to employees
Function in a similar way as debit cards
They are reloadable
Often linked to a credit card company, allowing employee’s to withdraw money from the ATM or to purchase goods and services through a POS
An alternative to printing and sending paychecks
Not linked to a depository institution account
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

14. Check 21
Check Clearing for the 21st Century Act (Check 21)- Transfers checks electronically and eliminates most or all float time
This allows a check to be processed as quickly as using a debit card
Float time - time between writing the check to when the money is withdrawn from the depository institution account
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

15. Pay by Phone
Pay by Phone system allows the consumer to call a vendor with instructions to pay certain bills or to electronically transfer funds between accounts
A written agreement between the consumer and the institution may be required for a transaction to occur
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona

16. Review Benefits include 24-hour access and convenience
Debit cards offer the benefits of a credit card without building debt
Direct deposits offer convenience to customers who have checks directly deposited into their account automatically
Direct payment allows bills to be paid electronically
© Family Economics & Financial Education – Revised May 2009 – Financial Institutions Unit – Electronic Banking
Funded by a grant from Take Charge America, Inc. to the Norton School of Family and Consumer Sciences at the University of Arizona