1. GOALS BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 1 3.2Electronic Banking Record electronic banking transactions Find account balance when banking electronically

2. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 2 Electronic Banking All banks use computers to process transactions electronically. Electronic banking allows bank customers to use telephones, computers, and other technologies in place of paper transactions such as writing checks and making loan payments.

3. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 3 Electronic Funds Transfer Banks use computers to transfer deposits and checks, or “funds,” from person to person and bank to bank. This process is called Electronic Funds Transfer, or EFT.

4. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 4 Customer Account Numbers and Bank Identification Number Banks print the account numbers of customers and the bank identification number in Magnetic Ink Character Recognition, or MICR, form at the bottom of deposit slips and checks.

5. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 5 Automatic Teller Machine Individuals can also transfer funds electronically when they use an Automatic Teller Machine, or ATM. By using an ATM card issued by your bank, you can withdraw or deposit money, see account balances, or make transfers between your accounts.

6. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 6 Personal Identification Number A Personal Identification Number, or PIN, that is known only to you is entered into the ATM before your transaction is processed. The PIN provides protection against unauthorized use of your ATM card.

7. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 7 Paying Bills with EFT EFTs may also be used to pay your monthly bills, such as utility bills. You can instruct your bank to transfer funds automatically each month from your bank account to the account of your utility provider. No checks are written or mailed.

8. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 8 Direct Deposit Some companies use EFT to pay their employees by transferring funds directly into their employees’ bank accounts without writing any checks to the employees. This is called direct deposit.

9. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 9 Debit Card Many people use a special form of EFT called a debit card. Debit cards allow you to pay for your purchases without using cash.

10. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 10 Using a Debit Card You insert your debit card into a special computer terminal at stores. The computer system subtracts the amount of each purchase automatically from your checking account and adds the same amount to the store’s bank account. You may also use your debit card to withdraw cash from your account. Fees may be charged for using this card.

11. BUSINESS MATH© Thomson/South-WesternLesson 3.2Slide 11 Recording Electronic Transactions When you use a debit card you get a receipt of the transaction. Save the receipt and immediately record the payment or cash withdrawal in your check register. Record the payment by writing the word “Debit” and adding a short description as well. Record an ATM withdrawal by writing ATM-WD. Record an ATM deposit by writing ATM-DEP.