UNIT-5, MONEY AND ECONOMY
QR Code (Quick
Response Code)
Money: Money is an
economic unit which is a recognized medium of exchange for transactional
purpose and functions as a medium of exchange, a unit of account and a store of
value. Before money was invented there were several things used for transaction
such as cowry shells, large stone wheels or string of beads (small decorative
objects). Now money is widely used for transaction of goods and services, but
in the modern time other payment methods are widely used such as checks,
debit/credit cards, mobile payment, electronic bank transfer, bit coins, coins,
diamonds and QR codes etc.
Economy: The management
of financial matters for a community, business or family. It can help improve
living standards and make society better place. Under this topic, there comes a
large set of interrelated production and consumption activities. The means of
production such as land, tools and technology which are used to produce goods
and services are either owned by private organizations or public organization.
These two systems are called capitalism and socialism respectively.
What is QR
Code?
A Japanese
engineer, Masahiro Hara, developed QR Code for the company DENSO WAVE in 1994.
The merchant payment was used in Japan and Later in China. The International
Standard ISO/IEC 18004 (Information Technology) for QR code was approved in
2004. (ISO- International Organization for Standardization, 1947, UK; IEC-
Import Export Code) The first adoption and use in mobile phone came with the
rise of the smart phones. First it was used to access information. The
proprietary standards of QR code were first adopted by the Chinese companies Tencent
and Alibaba for payment. EMVCo (Euro pay, MasterCard and Visa), the three
companies developed the payment industry standard in 2017. It was founded in
1998 and is located in California.
Customer’s Familiarity
with QR
Tencent
Holdings Ltd., a Chinese internet-based platform company founded in 1998,
incorporated QR codes service in its social media service WeChat. WeChat, an
instant message mobile app allows face-to-face friending by scanning a QR code
displayed on a friend’s mobile phone screen. Another Chinese multinational
technology company Alibaba Group Holding Limited, known as Alibaba facilitated
QR in Alipay service. At the same Tencent also extended WeChat pay, a payment
service directly integrated into social media service. Later both companies
encompass e-commerce (commercial transaction through internet), bill payment (including
utility).
Models to a QR
Code Payment in face-to-face service environment:
1. The user
presents a QR Code for scanning by the merchant
2. The
merchant presents a QR Code for scanning by the user/customer
1st
Method:
· The customer
presents his/her QR code
· The merchant
sets the transaction value and communicates to the customer before scanning
· On agreement
between the customer and the merchant the code is scanned
· The merchant’s
terminal requests payment from the customer’s account either through directly
from the scheme operator or through the acquirer
· Both the
customer and the merchant receive notifications of the success or failure of
the payment
· Finally, the
merchant hands over the goods to the customer
Drawback of
this method: The customer is vulnerable to and unscrupulous/dishonest merchant
setting of the wrong transaction value before scanning. For the solution of
this problem, the system needs a robust/genuine claims mechanism.
2nd method:
· The customer
scans the merchant’s QR code,
· If the value is
correct, only then the customer can scan the code, review the transaction
details and agree to transaction, that’s why this is more complex type of
transaction,
· After
forwarded to the system operator/acquirer
There are two options in this method:
Option 1
· The customer
scans the code,
· Validates the
merchant’s name and detail,
· Inputs the
value,
· The the system
notifies the merchant with the detail
· If all is well
then, the merchant hands the goods, otherwise there is dispute,
Option 2
· By using a
dynamic QR code, in which the merchant must have either a smart phone or a POS
device (Point of Scale) capable of displaying QR code,
· The merchant
enters transaction detail in the device,
· Then the code
is generated incorporating transaction value plus the detail of the merchant,
· The customer
scans the code, reviews the details and approves the payment,
· Finally, the transaction
is forwarded to the operator,
Alipay and
WeChat pay are the examples of prominent examples of QR code payment. They
follow the close loop payment system which works automatically. The
customers have to load fund into the spending account which is linked to the
payment device. It has the direct relation between the consumer and merchant
through payment system. This is just opposite to open loop payment
system in which banks play the role of mediators.
QR Codes –
International Card Schemes
As a result of
publication of the EMVCo standard, both Visa and MasterCard launched QR Code
based payment service in 2017 with a focus of emerging economics
Visa and
MasterCard focus on merchant present QR code both static dynamic (a
dynamic QR code can be edited and shared easily. Static QR codes, on the other
hand, cannot be changed. The QR code has already been printed on posters,
fliers, and even on the back of takeaway menus). They provide services in India, Kenya,
Nigeria, Cambodia, Egypt, Ghana, Indonesia, Kazakhstan, Malaysia, Rwanda,
Tanzania, Thailand, Uganda and Vietnam.
The brand name of
Visa's service is m Visa QR and the brand name of MasterCard service is
Masterpass QR. These services are
relevant to banked customers with an eligible Visa/Master Card- Debit card or
Credit card. Their banks have to enroll them in the scheme (programming
language) and integrated into their mobile banking app. Customers have to
download their banks' mobile banking app onto their mobile phone and
personalize it with their account details.
QR Based Payment Scheme/System
A scheme operator
is responsible for scheme branding (the process of giving a meaning to specific organization,
company, products or service) at
acceptance points, defining the scheme rules and providing a mechanism for
handling disputes and exceptions. The operator must provide a mechanism for
acquiring and settling transactions operate such services on behalf of the
scheme or securing cost effective, reliable and enduring access to one for use
by the scheme's participants.
QR Code Payments Security
There are
several security concerns around QR code payments,
· There is
little security around the codes, as a static codes displayed by a merchant could
easily be attacked by an unscrupulous criminal sticking their own code over the
merchant's code, which might not be noticed,
· The use of
merchant's IDs, registration and real time notification of payment is the
primary defense against such attack,
· The scanning extracts
the merchant ID for submission to the scheme for payment,
· The attackers
must have a valid merchant ID to which payments could be diverted for this
attack to be successful, and the onboarding process of the merchant would
provide sufficient information for the criminal to be identified,
· If a customer
makes a payment, but the merchant doesn't receive notification, then the
merchant doesn't hand over the goods, in such case an investigation is made to
see where the customer's fund has gone.
Though this is
a time consuming and expensive process, it would be better to stop the fraud
happening in the first place rather than trying to correct it.
The customers
are in the first line of defense. If the app displayed the merchant's name
(trading name), the customers must check if it is correct. The use of digital
signature is robust protection because the mobile banking app authenticates the
merchant's ID and name as well as the customer before the payment is made. The
app ensures if the merchant's name is correct or not.
Working with words
A. Match the
given words with their meanings.
Words Meaning
a. Prominent -Standing out so as to
be seen easily
b. Vulnerable -exposed
to the possibility of being attacked/harmed
c. potentialily -with
the capacity to develop or happen in the future
d. transaction -an
instance of buying or selling of something
e. initiatives -
the power or opportunity to do something before others do
f. launched -to
introduce a new plan or product
g. enduring -lasting
over a period of time; durable
h. robust -strong
and unlikely to break of fall
B. There are different abbreviations used in the
text. With the help of internet, find their full forms.
QR –
Quick Response
ISO -
The International Organization for Standardization
IEC –
International Electrotechnical Commission
URLs –
Uniform Resource Locators
EMVCo –
Euro Pay, Mastercar, Visa (Companies)
PIN –
Personal Identificaiton Number
C. Pronounce
the following words and identify the vowel sound /ÊŠ/ and /u:/. You can take help from a dictionary
Vowel sound /ÊŠ/ |
Vowel Sound /u:/ |
Put, Push, hood, full, bull, book,
foot, look, hook, cook, should, soot, room, stood |
Boom, food, loose, boost, groom, moon,
soon, room, soothe |
Comprehension
A. Decide
whether these sentences are True or False. Write NOT GIVEN if you
don’t find the informaiton.
a. The system
of QR codes was first launched in South Asia. False
b. The
standards of payments via the QR codes were approved by EMVCs. False
c. All sorts
of business are aided by the QR code payments. NOT GIVEN
d. There are
several models of the QR code payment service. False
e. In
countries like Nepal, the QR code paying system is a complete fiasco. NOT
GIVEN
f. The QR
codes payment service is not applicable to small buniness. False
B. Answer the
following questions.
a. How can one
pay with QR codes paying system?
Ans:- One can pay with QR codes paying system by
scanning the QR code displayed by the merchant using his/her smart phone and
entering the transaciton amount s/he has to pay for the good purchased or
services.
b. How did Tencent
and Alibaba companies utilise the QR code services at the beginning?
Ans:- Tencent and
Alibaba, both Chinese multinational companies utilised the QR code services by
adopting EMVCo developed proprietary standards.
c. How do the
QR code-based payment services launched by Visa and Mastercar mitigate payment
problems?
Ans:- The QR code
based payment services launched by Visa and Mastercard mitigatge (solve)
payment problem by focusing on Merchant presented QR codes (both static of
dynamic) . If the code is static the customer is required to enter the
transaction amount which is secured by their debit or credit card PIN. They
have linked QR code payment to debit and credit card accounts.
d. Why do we
need a scheme operator to run the QR code-based payment system?
Ans:- We need a
scheme operator to run the QR code based payment system for branding the
scheme, defining the scheme rules and providing a mechanism for handling
disputs and exceptions.
e. What basic
requirements are needed to use the QR code payment system?
Ans:- The baisc requirements needed to use the QR
code payment system are: i) the development of QR code payment mobile app by
the merchant and ii) the smart phone capable to scan the QR code along with the
merchant’s mobile phone app installed in it and by linkng to bank account of
loading the fund to the app.
f. How can
security concerns related to payment via QR codes be addressed?
Ans:- The security
concern related to the payment via QR code can be addressed by using merchant’s
ID, registration system, and real time notificaiton of payment to both the user
and the merchant.
g. Who should
be more careful: customer of the merchant in terms of payment issue? Why?
Ans:- The customers
should be more careful in terms of payment because they are in the first line
of defense and they have to check the details of the merchant before the
payment is made.
h. Do you
think the QR code-based payment can be a panacea for all sorts of payment problems?
Why?
Ans:- I don’t think
that the QR based payment can be a panaca (remedy) for all sorts of payments.
For making payment via QR code, any customer must have knowledge about the
function of this system. They must have smart phones along of mobile app
installed and internet facility. Most of the people still don’t have technical
knowledge and can’t operate QR code payment. Even theyd don’t have any idea
about this system of payment because it is more complex and difficult. In such
a situation, still QR code-based payment can’t be a remedy for all sorts of
payment problems.
Critial
Thinking
a. Some
business houses, shops and department stores in city areas have started to
adopt QR code payment system in Nepal, too. What should be done to make more accessible?
Discuss.
Ans:- The QR code
payment system is a digital and contactless payment system. This digital mode
of payment has become more applicable in cities in Nepal. This contactless
payment allows the customers pay for the goods purchased via scanning the QR
codes provided by the merchant using their smart phones. In the past different
things were used to make transaction such as cowery shells, large stone wheels
and strings of beads. At the present time payments can be made through check,
wire transfer, debit/credit cards, and QR codes. Such kind of payment system is
very much useful in such a place where people are familiar with technology or
digital world, otherwise it is troublesome. Although a large number of people
in Nepal are unfamiliar with this payment system, some business houses, shops
and department stores in cities have adopted this mode of payment. Our country
has many remote areas and people don’t have access to internet and
technological knowledge either. To make it more accessible, there must be
availability of internet facility and technological knowledge about it. Even
most of businesses, merchants, traders in remote areas don’t have knowldege
about the QR. So first of all, there must be internet facility, and technical
knowledge about this system of payment.
b. The payment
landscape is shifting gears from cash to digital mode. Digital payment brings
ease and convenience to the consumer. Is it possible to apply such cashless
methods in payment in Nepal? Discuss.
Ans: - In the past, most
of people in Nepal depened on cash and cheque for payment system. Even most of
people preferred to transact on cash rather than cheque. With the gradual
familarity to digital world, easy access to internet and smart phones, most of
people in city areas prefer to purchase goods via digital mode of payment.
Instead of paying cash for services, goods and utility bills and investing in
share market people prefer to use digital wallets such as Khalti, Esewa, mobile
banking apps, Mero Share and Connect IPS etc. Even most of banks provide mobile
banking and internet banking services which are preferred by the customers
these days. In this way the payment landscape is shifting gears to digital
mode. This digital mode of payment has made the payment system easy and fast.
People had to use time and efforts for making payments on cash. They had to go
to the counters and had to wait for their turn to make payment of utility bills
such as telephone, electricty and water. Even people pay school fees through
digital medium. It has become easy and convenience to the consumers.
This mode of
payment is complex though it reduces our time. The matter of security is
another problem because sometime we read news about unscrupulous attack of the
criminals in digital world by hacking and taking away money from people’s
account. Internet facility is another problem for applying cashless payment in
Nepal. Even most of financial institutions are not familiar to this mode of
payment. For applying cashless payment throughout Nepal, the above-mentioned
problem must be addressed first.
Writing
A. Punctuate
this paragraph with appropriate punctuation marks.
Ans:
it was a cold freezing day it had been snowing all day in new
york mr tim cooked and i went outside to play in the snow we had not seen much
snow since we went to skiing in sweden last year mrs smith was right because
she had said that we’d see snow the next day we had really a wonderful time
there didn't we
Punctuation
It was a cold
freezing day. It had been snowing all day in New York. Mr. Tim cooked and I
went outside to play the snow. We had not seen much snow since we went to
skiiing in Sweden last year. Mrs. Smith was right because she had said that
we’d see snow the next day. We had really a wonderful time there, didn’t we?
B. Write a
news article about digtial payment system in Nepal.
Will be
availabe in the description of the video soon.
Grammar:
Questions
A. look at the
following questions and say what type of questions they are.
a. Do you like
this country? Yes/No
Question
b. Where is
she from? Wh-Question
c. How many
eggs do we need for this cake? Wh-Question
d. Whose
children are playing in the yard? Wh-Question
e. Does she
like ice cream or sweets? Yes/No-Question/Choice
Question
f. She sent
him an invitation, didn’t she? Question
Tag
g. Could you
tell me if the doctor is available? Request/Yes/No-
Question
h. Do you know
how tall they are? Yes/No
Question
B. Choose the
correct words from the box to complete the sentences.
Do you is can where did does did
a. Is
your friend a scientist? - No, he’s an artist?
b. Does
Naresh live in Kathmandu? – No, he lives in Pokhara.
c. When did
you get home? – I got home yesterday.
d. What time do
you get up? – I get up at 6:00.
e. Did
the children go to the party? – Yes, they went there after school?
f. Are you
going to school? – No, I am going home.
g. Can
you speak Chinese? – Just a little.
h. Where did
you grow up? – I grew up in Okhaldhunga.
C. Make
wh-questions so that the words in bold become the answer.
a. Romeo loves
Juliet.
Ans:- Whom
does Romeo love?
b. My mother
made a delicious bread yesterday.
Ans:- What did
my mother make yesterday?
c. The music
was composed by Narayan Gopal.
Ans:- Who was
the music composed by?
d. I’m looking
for a new book.
Ans:- What are
you looking for?
e. They were
talking about the new movie.
Ans:- What
were they talking about?
f. She got the
idea from a story?
Ans:- Where
did she get the idea from?
g. She always
goes to school on foot?
Ans:- How does
she go to school?
h. She sometimes
goes to the cinema?
Ans:- How
often does she go to the cinema?
i. They have
been waiting for three years.
Ans:- How long
have they been waiting for?
D. Change
these indirect questions into direct ones.
a. Could
you tell me where the market street is.
Ans:- Where is
the market street?
b. I’m
longing to know what time the bank opens.
Ans:- What
time does the bank open?
c. Do you
have any idea how he’s managed to get in shape so quickly?
Ans:- How has
he managed to get in shape so quickly?
d. I’d like
to know how much this motorcycle costs these days.
Ans:- How much
does this motorcycle cost these days?
e. Did you
notice if he had left the car in the park?
Ans:- Had he
left the car in the park?
f. Have you
found out if the train has left?
Ans:- Has the
train left?
g. I was
wondering if they speak English well.
Ans:- Do they
speak English well?
h. Would
you tell us how we can get to the post office from here?
Ans:- How can
we get to the post office from here?
i. Do you
remember if I locked the front door?
Ans:- Did I
look the front door?
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