Payment

All about Payment

Payment is defined as "the partial or complete discharge of an obligation by its settlement in the form of the transfer of funds, assets, or services equal to the monetary value of part or all of the debtor's obligation". Payment is an act of giving a sum of money after getting the work done. In other words money is given for carrying out what has been promised. You get a salary as a payment for your work for a period of a month, a day or fortnight. Whenever you purchase something or dine out in restaurants, don't you pay the retailer or the restaurateur finally to end the deal. This called payment as you pay for the services availed. From barter system in early period to this modern age payment has been the basis of any transaction or business dealing. Nowdays, money is widely being used for making payments and accounting for debts and credits.

Payment is simply the fulfillment of a promise. Although this is the normal understanding of the word, payment also means all the ways in which a creditor is satisfied and the debtor is made free. An example would be, suppose a person owes you money and you have kept a valuable item of his as colateral. With the passing of time you want to own a piece of land as a payment. When that is finished the first obligation of that person is finished.

It's not always that the payment is done in one go. Sometimes the amount is paid in parts or installments. Like the payments done to the lender periodically in order to repay the loan. It covers interest repayment, premiums and principal amount. In other loans, like short-term and fixed rate loans initially a small payment is done for a fixed period of time and then the remaining amount is paid at a specified time.

Payments are made in cash, through checks, debit cards and credit cards. In today's modern world many people use the Internet to carry out their monetary transactions online. This has given a charge to the e-commerce industry. Credit cards have aided a lot in purchases made online. People were already used to using credit cards. Now they are able to buy and sell from the home itself, more and more people prefer e-commerce transactions. Credit cards are a good mode of payment but the problems of credit card fraud is still a problem not solved.

Other methods of payment that are more secure and cost less have also been invented such as paypal. To avoid any complications or legal troubles one should always make their payments on time and never buy somthing they cannot pay for.