Question

Jay owns an event management company in Jaisalmer which provides customised facilities to meet the needs of the customers and ensures a memorable event for them. He has a staff of 50 persons. Earlier the salary of the staff members was paid through cheques. The employees had to deposit their cheque in the bank and had to wait for two to three working days for it to be cleared. But now the salary reaches their account on the same day itself with the help of a particular banking service. Identify the method adopted by Jay.

Options

• Overdraft Facility

• Cash Credit

• Electronic Fund Transfer

• E banking

Answer 1

Electronic Fund Transfer

Explanation:

• Jay used to pay his employees by cheque, which took 2-3 days to clear. Now, the salaries are directly credited to the employees’ bank accounts on the same day.
• This is possible through Electronic Fund Transfer (EFT), where money is transferred electronically from one bank account to another.