Billing, Payment And Collection Policies: Fill & Download for Free

You did not mention the most important thing:What exactly is your budget. What is your relationship? Son? Daughter? nephew? or a family friend?In the absence of this information it is difficult to suggest.I asked my wife to see what her thoughts were.Her feminine common sense lead her to say: Nothing material. At that age, they don’t want to collect more articles. They must be already overloaded and would be happy to get rid of many things they have and hardly ever use.So I suggest you pay for a short pilgrimage trip or a week end get away.Or pay the premium for a two year health insurance policy.Or deposit a few months electricity/phone bill payments into their account with the electricity board or phone company.If your budget is low, get them a Reliance Jio wireless hotspot and teach them to use it with their tablet, or smart phone or laptop, if they are computer savvy.Or get them a warm blanket, or an electric kettle, or fomentation pad or a thermos flask. Heat is a great comfort for people of this age.And finally, don’t avoid attending. For such people your presence is a greater gift than anything material.Hope this helps.GV

This is a pretty wide open question. Will try to answer as much as I can. I've included more visual versus text, as visuals can very easily get the point across, in a few minutes. Should you wish to explore further, I have provided some relevant links for further reading.First of all, the definition. When discussing payment systems, it is so easy to have different understanding of what a payment system is.WHAT IS A PAYMENT SYSTEM?a payment system consists of a set of instruments, bankingprocedures and, typically, interbank funds transfer systems thatensure the circulation of moneyGlossary definition from the Committee on Payment and Settlement Systems (BIS - Bank of International Settlements). See glossary at: http://www.bis.org/publ/cpss00b.pdf (March 2003)In its basic form a payment ecosystem has this very important singular relationship, without which a payment cannot be made:The whole concept of a "payment" is to exchange money between two parties, so hence the Payer and Payee concept.*Barring Bitcoin, regulated money (which is what 99.999+% of us use) requires a bank. It is not necessarily that a bank is required to move money, but a Bank is at the core, for example in Cash-to-Cash transaction, whilst a bank is not involved, a Bank was the source of the cash and could very well be the destination of cash as well (if) and when it gets deposited.The definition of a Payment System can be visualized as follows:The Payment Instrument section above can be expanded as:Central to all this is the Bank, and how the bank interacts with various entities would be explained below. First, you have to understand with whom a commercial bank can interact with:The above essentially represents the eco-system in which a commercial (non-investment bank) is operating in. The ovals in purple, represents the various verticals a bank can choose to associate themselves with and work in/with.A slightly wider view of the same would be:Credit: Above visuals are extracted from the presentation "An Introduction of Payment Systems" by Dyah N.K. Makhijani, Bank Indonesia. Source: http://www.bi.go.id/NR/rdonlyres/10122ACC-8ACC-41E1-91EA-94F3D98B874F/14130/AnIntroductiononPaymentSystem.pdfAs far as Banks are concerned, there are many types of banks, below is a pictorial representation of the different types of banks:PAYMENT SYSTEMS LAYER (REGULATORY)In most cases, a payment's ecosystem has a hierarchy of how the central bank is, then commercial banks, the payments layers and companies that work with the payments layer (as one of the examples, here is how a payments system hierarchy looks like for startups in a particular model that I was trying to demonstrate):The concept shown in the above diagram in a rudimentary form was to show that in most cases, Startups work with a Payment Service Provider who work with Banks, who are regulated by the Central Banks.THE FINANCIAL SWITCH ECOSYSTEMThe Switch in the Payment's Ecosystem is extremely important, it is what allows for a lot of the connectivity and transactions routing/communication to go through.Below is an example what the transaction set of a unified switch would look like. Not every transaction set shown below has to be on the switch, this is just a unified example, it all depends from switch to switch and operators/usage of that switch.BANK TO BANK (SETTLEMENT OF FUNDS)One thing that confuses people a lot is how is the bank to bank settlement done?I wrote a detailed answer on this which can be read here: Faisal Khan's answer to How does the settlement of payments work in banks? Specifically, how do payment systems that are connected to multiple banks actually settle the amount between two banks?To better understand how money is actually transferred between banks and different countries, you would most likely want to read up on this: Faisal Khan's answer to How does money transfer between banks and different countries work?WIRE TRANSFERS - HOW DO THEY WORK?From a wire transfer point of view, what exactly happens when a Wire Transfer is made, please read this answer: Faisal Khan's answer to What exactly happens when a wire transfer is made? How does the money travel from the sender's account to the recipient's account? How much time does each step take? What regulatory measures are in place, if any?Even more important is to understand what exactly happens when a remittance transfer is made? What are all the steps involved in a money-transfer transaction: Faisal Khan's answer to How does a remittance money transfer work? What are all the steps and who is involved?PAYPAL WALLETBecause PayPal will so frequently be cited as an example, many people need to learn up as to what exactly PayPal is and how does money loading/off-loading on a PayPal wallet actually work?To understand how it all works, here is a detailed answer on how PayPal works: Faisal Khan's answer to What is a Paypal account? Is it a kind of bank account which is maintained for demand deposits? __ 𝐏𝐥𝐞𝐚𝐬𝐞 𝐂𝐚𝐥𝐥 PayPal 𝐓𝐨𝐥𝐥 𝐅𝐫𝐞𝐞 𝐒𝐮𝐩𝐩𝐨𝐫𝐭 𝐍𝐮𝐦𝐛𝐞𝐫 ☏+❶►❽❺❻▁❹❼❺►❷❺❺❺?WHAT HAPPENS WHEN YOU CHARGE YOUR CARD?From a merchant's POV, the payments ecosystem processing looks something like this:In a process flow, it would look something like this:Since everyone has a slightly different way of representing flows, here are a few more:and another one:Nomenclature aside, the key players/components are the same:Role of an Acquirer: the acquirer (Chase, First Data, etc) solicits, underwrites and owns the merchant account. They provide technology and hardware, which enables the merchant to process the transaction.Role of the Issuer: The issuer is the bank (Capital One, CIBC, RBC, etc) that provides the cardholder with their credit card. They bare the responsibility of approving the cardholder and billing and collecting the owed funds from cardholder.Credit Card Associations: Associations (Visa, MaterCard, AMEX, et) are commonly referred to as the credit card and debit card companies. The role of the associations is to govern the policies pertaining to their bank cards, monitor processing activity, and oversee the clearing and settlement of transactions. Currently VISA is the most popular association with approximately 65% transaction volume.ISOs (Independent Sales Organizations): ISOs (Payfirma, Square, etc) are organizations that partner with acquirers to open merchant accounts, handle support, manage payment processing, and build added-value technology on behalf of acquirers. ISOs do this in exchange for a percentage of the transaction volume.Merchant: The merchant is a business owner who submits a request to an ISO/acquirer for the ability to accept credit. Merchants are approved under the qualifications set by the associations and the policy of the underwriters.Cardholder: Cardholders (consumers) are customers of a bank that request a credit card. The cardholder will be approved by the issuer based on credit worthiness.Source: Payment Processing 101Here is a graph of how transfer fees in a credit card transaction works:A simple visual, to give you an example of some of the vendors involved:Juxtapose this to mobile payments, and it is inherently no different. Below visual shows the various types of payment systems.Here is another infographic on the mobile-payment ecosystem:On the product side of things, there is no one-product that fits, all, below is a rough representation of how the market segment that you will market to, look like:On the processing side, you might want to read this answers:How are credit cards validated and processed through providers such as Paypal and Square?How do credit card companies make money?How do payment gateways like authorize.net connect to credit card companies?One other link I would like to recommend to understand how consumers make choices as far as payment instrument of choice is concerned: The 2009 Survey of Consumer Payment ChoiceTo better understand the various payment systems - these two infographics are worth reading and are must-read/must-have.Evolution of Payments Market Map (2011)Mobile Payments and Banking Market Map (2012)Both these PDFs can be downloaded for free from: Downloads: Market MapsYou may also want to have a look at BIS (Bank of International Settlements), they have an excellent repository of reports (PDFs) on various payment systems around the world. Source: Payment and settlement systems in selected countriesThere is just so much information out there. Inbox me if you require more information.About the Author: Faisal Khan is a banking / payments consultant and digital money evangelist. He is the co-host of Around the Coin, a weekly podcast on banking, money and payments. He is also a frequent contributor to popular Q&A site Quora. His official website is at www.faisalkhan.com

The worst example of the ‘no separate billing’ I ever ran into was at a restaurant in the US when we were there with the hockey team my husband coached. We had heard great things about the place, and after a couple of trips, finally it worked out that we could go there. So probably about thirty of us went, we were seated in separate rooms since there was not room for us in one, I’m not sure what the other rooms were like, but the one we were in had booths for two or four people. No mention of one bill for all at this point, remember we had no way of knowing what other people, even in the same room, were ordering. I don’t mean to suggest that anyone deliberately tried to cheat, but consider, if you spent a couple of hours eating and drinking, expecting to get a bill for what you consumed, would you remember everything that you had, including extras, and the price for all of it? Plus taxes etc?So at the end of the evening when most of us had had several drinks (we were all using taxis, no one was driving, so we relaxed more than we might have otherwise) we’re told it’s one bill for the whole group! My idiot husband said we would look after it, and he went around to however many places there were people from our party, and collected whatever they thought they owed. Of course it came up way short, even though I’m sure some had added a fair tip too. The restaurant wouldn’t fix it (to be fair they probably couldn’t at that point, it would have been a nightmare trying to figure out who had what out of that long list), and my husband refused to go back around and collect more, so we ended up paying many times what our own bill should have been, and were short money all the rest of the trip.