A value transfer system refers to any system, mechanism, or network of people that receives
money
Money is any item or verifiable record that is generally accepted as payment for goods and services and repayment of debts, such as taxes, in a particular country or socio-economic context. The primary functions which distinguish money ar ...
for the purpose of making the funds or an equivalent value payable to a third party in another geographic location, whether or not in the same form.
The average size of the payment is an indicator of the
system's use. Specialised large-value transfer system have developed because of the large size and critical timing of some payments
market participants require services and mechanisms that meet their need for reliability, security, accuracy and timeliness.
A value transfer system may fall into one or more of these groups:
*Retail value transfer systems:
**Traditional retail value transfer systems, e.g.
Bank transfer,
Wire transfer,
Post office
A post office is a public facility and a retailer that provides mail services, such as accepting letters and parcels, providing post office boxes, and selling postage stamps, packaging, and stationery. Post offices may offer additional serv ...
s transfer service or specialist companies such as
Western Union
The Western Union Company is an American multinational financial services company, headquartered in Denver, Colorado.
Founded in 1851 as the New York and Mississippi Valley Printing Telegraph Company in Rochester, New York, the company ch ...
**
Internet
The Internet (or internet) is the global system of interconnected computer networks that uses the Internet protocol suite (TCP/IP) to communicate between networks and devices. It is a ''internetworking, network of networks'' that consists ...
-only value transfer systems, e.g.
Electronic money such as
PayPal
PayPal Holdings, Inc. is an American multinational financial technology company operating an online payments system in the majority of countries that support online money transfers, and serves as an electronic alternative to traditional paper ...
,
eGold,
Liberty Reserve
***
Cryptocurrencies
A cryptocurrency, crypto-currency, or crypto is a digital currency designed to work as a medium of exchange through a computer network that is not reliant on any central authority, such as a government or bank, to uphold or maintain it. It ...
:
Bitcoin
Bitcoin ( abbreviation: BTC; sign: ₿) is a decentralized digital currency that can be transferred on the peer-to-peer bitcoin network. Bitcoin transactions are verified by network nodes through cryptography and recorded in a public di ...
,
Litecoin
Litecoin ( Abbreviation: LTC; sign: Ł) is a decentralized peer-to-peer cryptocurrency and open-source software project released under the MIT/X11 license. Inspired by Bitcoin, Litecoin was among the earliest altcoins, starting in October 2011. ...
,
Ethereum
Ethereum is a decentralized, open-source blockchain with smart contract functionality. Ether ( Abbreviation: ETH; sign: Ξ) is the native cryptocurrency of the platform. Among cryptocurrencies, ether is second only to bitcoin in market cap ...
, etc.
*Institutional formal value transfer systems, e.g.
SWIFT
Swift or SWIFT most commonly refers to:
* SWIFT, an international organization facilitating transactions between banks
** SWIFT code
* Swift (programming language)
* Swift (bird), a family of birds
It may also refer to:
Organizations
* SWIFT ...
(International), domestic
real-time gross settlement
Real-time gross settlement (RTGS) systems are specialist funds transfer systems where the transfer of money or securities takes place from one bank to any other bank on a "real-time" and on a " gross" basis. Settlement in "real time" means a payme ...
(RTGS) systems such as
LVTS (Canada),
Fedwire
Fedwire (formerly known as the Federal Reserve Wire Network) is a real-time gross settlement funds transfer system operated by the United States Federal Reserve Banks that allows financial institutions to electronically transfer funds between its ...
(USA),
CHAPS
Chaps ( or ) are sturdy coverings for the legs consisting of leggings and a belt. They are buckled on over trousers with the chaps' integrated belt, but unlike trousers, they have no seat (the term "assless chaps" is a Tautology (language), taut ...
(UK)
*
Informal value transfer system
An informal value transfer system (IVTS) is any system, mechanism, or network of people that receives money for the purpose of making the funds or an equivalent value payable to a third party in another geographic location, whether or not in the ...
s, e.g.
hawala
Hawala or hewala ( ar, حِوالة , meaning ''transfer'' or sometimes ''trust''), also known as in Persian, and or in Somali, is a popular and informal value transfer system based on the performance and honour of a huge network of money ...
See also
*
Digital currency
Digital currency (digital money, electronic money or electronic currency) is any currency, money, or money-like asset that is primarily managed, stored or exchanged on digital computer systems, especially over the internet. Types of digital ...
*
Electronic funds transfer
Electronic funds transfer (EFT) is the electronic transfer of money from one bank account to another, either within a single financial institution or across multiple institutions, via computer-based systems, without the direct intervention of ...
*
Correspondent account A correspondent account is an account (often called a nostro or vostro account) established by a banking institution to receive deposits from, make payments on behalf of, or handle other financial transactions for another financial institution. Co ...
*
Payment system
References
External links
*1996 paper: The Effect of Internet Value Transfer
Financial economics
Payment systems
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