COVID-19 has put businesses across the country in limbo and it’s unlikely that the rest of Q3 is going to be much different. Apart from the massive impact on public health, the global crisis has triggered a chain of economic shocks that’s not just unprecedented but downright challenging. The stakes are high and amidst heightened concern over the transmission of the virus, situations like quarantines, lockdown, and social distancing have not only transformed the fabric of business operations but more significantly, it has upped the usage of digital and electronic payment methods.

So, what exactly is EFT?

Electronic Funds Transfer is the electronic transfer of money from one bank account to another within the same or separate banking/financial institutions. There are several types of EFT, of which the following are some of the most frequently used:

• ATMs
• ACH Transfers
• Wire Transfers
• Instant Payments
• Electronic Checks
• Online Bill Payments
• Direct Deposit Payments
• Debit or Credit Card Transactions

What is the significance of EFT in 2020?

EFT processes make a good option for business owners and a viable alternative to cash payment for several reasons. However, the current times have increased its significance manifold simply because:

• It has not collapsed but rather accelerated through the COVID-19 phase. It is hope amid uncertainty and means continuity for an otherwise stagnant economy.

• It has retained its core values and emerged as a viable option for even small businesses in the long run.

What Else Do I Need to Know About EFT?

The following points emphasize some of EFT’s core significance and knowing them can help you make stronger decisions about the future.

1. Flexible, Convenient and Efficient

The 2020 crisis calls for a reassessment of basic infrastructure and operational methods for many. As we ponder over risk mitigation, the value of an EFT process stands out as a flexible, time saving, cost-reducing, and inclusive growth-inducing model. In reducing additional costs, simplifying transaction processes, maintaining a reliable transaction repository and in streamlining internal processes, EFT helps improve operational efficiency and maintain commitment with business partners, suppliers, and customers.

2. Higher Security Means Lower Payment Frauds

Credible financial management institutions are committed to providing the highest level of security for their clients, thus partnering with a reliable firm can ensure that EFT payments made for business transactions are sent through highly secure communication channels, thereby limiting the chances of various payment frauds.

3. Be a Green Economy Supporter

Even a simple step can make a big contribution to reducing the hazardous impact on our planet caused by so many of our actions. Less paper means more trees as well as less carbon emission. While debates exist around the pros and cons of going paperless, what we can do is cut out the excess consumption without necessarily jeopardizing our forests, ecosystems or even the livelihoods of people.

2020 has been a game-changer and as we ponder over future prospects and what will the new normal be like, tools like electronic funds transfer (EFT) resonates with the larger necessity of digitalization and the potential it holds during and post the crisis. Digitalization has made a significant impact across a wide range of industries and while a universal change in payment behavior by customers, governments and private businesses is still under discussion, we remain hopeful that a model conducive to our economy as well as our basic rights can be devised and appropriately utilized in due course of time.