E-Banking

E- banking refers to electronic banking. It is like e-business in banking industry. E-banking is also called
as virtual banking or online banking. E-banking is a Result of the growing expectations of bank customers. Ebanking involves information technology based banking. Under this IT system the banking services are
delivered by way of a computer-controlled system. This system involves direct interface with the customers.
The customers need not to visit bank premises.
Popular services covered under E-banking
1. Automated teller machine
2. Credit card
3. Debit card
4. Smart card
5. Electronic funds Transfer system
6. Cheque truncation system
7. Mobile banking
8. Internet banking
9. Telephone banking
Automated teller machine
ATM is designed to perform the most important function of bank. it is operated plastic card with its
special features. The plastic card has replaced cheque Personal attendance of the customer banking hours
restrictions and paper based verification. These are debit cards. An ATM is an electronic funds Transfer
terminal capable of handling cash deposits Transfer between accounts balance enquires, cash withdrawals and
pay bills. It may be online or Offline. Any customer processing ATM card issued by the shared payment
network system can go to any ATM linked to shared payment networks and perform his transactions
Credit card/ Debit card
The Credit card holder is empowered to spend wherever and whenever he wants with his Credit card
within the limits fixed by his bank. Credit card is a post paid card. Debit card considered as a prepaid card with
usage facility limited to the balance in the linked deposit account of the cardholder. An individual has to open
an account with the issuing bank which gives debit card with a Personal identification number. When he makes

purchases he enters his pin on shops pin pad. When the card is slurped through the electronic terminal it dials
the acquiring bank system -either master card or VISA that validates the pin and finds out can never overspend
because the system rejects any transactions which exceeds the balance in his account. The bank never faces a
default because the amount spent is debited immediately from the customers account.
Smart card
Banks are adding chips to their current magnetic stripe cards in order to enhance security and offer new
services that are called smart cards. Smart cards allow
Thousands of times of information storable on magnetic stripe cards. In addition these cards are highly secure,
more reliable and perform multiple functions. They hold a large amount of Personal information ranging from
medical and health history to Personal banking and personal preferences.
Services of E-banking
E-banking provides a multitude of services that are as follows
1. Bill payment service
E-banking facilitates the payment of electricity bills, telephone bills, Credit card, and insurance
premium bills. And the bank does not charge customers for online payments
2. Fund Transfer
You can Transfer any amount from one account to another of the same or any another bank.
Customers can send money anywhere in India.
3. Credit card customers
With internet banking customers cannot only pay their credit card bills online but also get a loan on
their cards. In case of loss of the credit card an online reporting can be done.
4. Investing through internet banking
Now, FD can be opened on line through funds Transfer and investors with interlinked demit account
and bank account can easily trade in the stock market.
5. Recharging prepaid mobile
By just selecting the operator name entering the mobile number and the amount of Recharge the
mobile phones can be back in action within few minutes.
6. RTGS fund Transfer

RTGS is an inter Bank funds Transfer system. Where are Transferred as end when the transactions are
tiggered.
7. Shopping
Online Shopping can also be done with a range of all kind of products. Railway and air tickets can be
bought through the internet banking.
8. Online payment of taxes.
A customer can pay various taxes on line including excise and service tax direct tax etc.
Electronic funds Transfer
Electronic funds Transfer provides for electronic payments and collections. EFT is safe secure,
efficient and less expensive than paper check payments and collections . RBI EFT is a scheme introduced by
RBI to help banks offering their customers money Transfer service from account to account to any branch to
any other bank branch in places where services are offered.
Internet banking
Through internet banking you can check your transactions at any time of the day and as many times as
you want to. Where as in a traditional method you get quarterly statements from the bank. If the fund Transfer
has to be demand outstation where the bank does not have a branch the bank would demand outstation charges.
Whereas with the help of online banking.
Mobile banking transactions
Now banks have started offering mobile banking and telemarking to their customers. The expansion in
the use and geographical reach of mobile phones has created new opportunities for banks to use this mode for
banking transactions and also provide an opportunity to expand banking facilities to the excluded sections of
the society.

Financial Inclusion
Financial inclusion or inclusive Financing is the delivery of financial service at affordable costs to
sections of disadvantaged and low income segments of society. Or we can say that financial inclusion may be
defined as the process of ensuring access to Financial inclusion in timely and adequate Credit when needed by
vulnerable groups such as weaker sections and low income groups at an affordable cost.
Unrestrained access to public goods and services is the sine qua of an open and efficient society. It is argued
that as banking services are in the nature of public good it is essential that availability of banking services and
payment services to the nature of public good it is essential that availability of banking and payment services
to the entire population without discrimination should be the prime objective of public policy. the term
Financial inclusion has gained importance since the early 2000s and is a Result of findings about Financial
inclusion and it direct correlation to poverty. Financial inclusion is now a common objective for many central
banks among the Developing nations
Financial inclusion offers people the following things
1. Access to Financial markets
2. Access to Credit markets
3. Financial literacy
Objectives of Financial inclusion
1. Access at a reasonable cost for all house holds and enterprises to the range of Financial services for which
they bankable including savings , short and long term credit , leasing and factoring , mortgages , insurance ,
pensions, payment , local money Transfers and international remittances.
2. Sound institutions guided by appropriate internal management systems, industry performance standards and
performance monitoring by the market as well as sound prudential regulation wherever required.
3. Financial and institutional sustainability as a means of providing access to Financial services over time.
4. Multiple provides of Financial services wherever feasible so as to bring cost effective and a wide variety of
alternatives to customers
Financially excluded sections largely comprise of the following activities.
1. Marginal farmers
2. Landless laborers

3. Oral lessees
4. Self Employed and unorganized sector enterprises
5. Urban slum dwellers
6. Migrants
7. Ethnic minorities and society excluded groups
8. Senior citizens
9. Women
The north east eastern and central regions of India contain most of the Financially excluded population.
Benefits of inclusive financial growth
The benefits of inclusive financial growth can be described
1. Growth with equity:- In the path of becoming super power we the Indians need to achieve the growth of
our country with equality. It is provided by inclusive finance.
2. Getting rid of poverty:- To remove poverty from the Indian context everybody will have to be given access
to formal Financial services . Because if they borrow loans for business or Education or any other purpose then
that will pave the way for their Development.
3. Financial transactions made easy:- Inclusive finance will provide banking related Financial transactions
in an easy and speedy way.
4. Safe savings along with Financial services:- People will have safe savings along with other allied services
like insurance cover, entrepreneurial loans payment and settlement facility etc.
5. Increasing National income:- boosting business opportunities will definitely increase GDP that will be
reflected in our National income growth.
6. Becoming global player:- Financial access will attract global market players to our country that would
Result in increased Employment and business oppurtunities.

Some Financial Institutions

[(Introduction)]

Securities Exchange Board of India (SEBI): It is regulatory authority of stock exchanges and
protects investors from Fraudulent dealings. It was established in April 1988 and awarded
statutory status by Act of parliament in 1992.
Chairman: UK Sinha
Head quarters : Mumbai
Insurance Regulatory & Development Authority (IRDA) : It is apex body formed under Sec.4
of IRDA Act 1999 to protect the interests of the policyholders to regulate promote and ensure
orderly growth of the insurance industry in India
Financial Stability & Development Council : This is the apex financial regulator of our
country. Headed by Finance Minister, it coordinates and regulates to four financial regulators of
the country i.e. RBI,SEBI,IRDA and PFRDA to ensure that all of them operate and function in
harmony to promote the growth and stability of Indian Economy.
Indian Banks Association (IBA) : It is the official association of all the banks operating in
India. It acts as a bridge between banks on one hand and government and staff unions on the
other. Presetly Mr. K.R. Kamath, CMD of Punjab National Bank is Chairman of IBA.
Non Banking Financial Company (NBFC): These are companies which have functions similar
to banking like accepting deposits and making loans. However they do not have license for
banking, although they are regulated by RBI.

Deposit Insurance & Credit Guarantee Corp.(DI&CGC) : It is a wholly owned subsidiary of

RBI which provides an insurance cover of Rs.1lakh per depositor per bank in case of bank
failure.It also provides guarantee of repayment amount in default of small loans given by banks.
Export Credit Guarantee Corporation of India (ECGC): ECGC is a Govt. body which
provides export credit insurance facilities to exporters and banks in India. It encourages Indian
exporters by giving them credit insurance covers.
Banking Codes and Standards Board of India: It is a industry watch dog set up by RBI to
monitor and assess the compliance with codes and minimum standards of service to individual
customers, as prescribed by the RBI.
Credit Information Report: A Credit Information Report is a factual record of a borrowers
credit payment history compiled from information received from different credit grantors. Its
purpose is to help credit grantors make informed lending decisions-quickly and objectively.
Credit Rating: Credit Rating is an assessment of the probability of default on payment of
interest and principal on a debt instrument. In simple words, it ranks the company or countrys
ability to meet their debt obligations.

Negotiable Instruments
(Introduction)
There are certain documents used for payment in business transactions and are Transferred
freely from one person to another. Such documents are called negotiable Instruments like
cheque, bank draft, bill of exchange, promissory notes etc. Thus we can say negotiable
Instruments are a transferable document where negotiable means transferable and Instrument
means document. According to section 13 of the negotiable Instruments act 1881. A negotiable
Instrument means promissory note bill of exchange or cheque payable either to order or to
bearer.
Features of a Negotiable Instrument
1. It is a written document
2. A negotiable Instrument payable to bearer is transferable merely by delivery whereas a
Negotiable Instrument payable to order is transferable by endorsement and delivery.
3. The holder of a Negotiable Instrument can sue upon it in his own name.
4. Its works in the same manner as money and like money it may also be transferred from one
person to another.
5. The Transferor does not need to give notice to any person at the time of transferring the
Instrument.
6. It is the simplest and most convenient mode of assignment of a debt.
7. The tittle to the Instrument received by a bonafide transferee is not affected by defect in the
title of the transferor.
A. Negotiable Instruments
1. Promissory note

2. Bill of exchange
3. Cheque
4. Exchequer bill
5. Circular note
6. Dividend warrant
7. Share warrant
8. Bearer debenture
9. Bank note
10. Bank draft
B. Non Negotiable Instruments
1. Money order
2. Postal order
3. Deposit receipt
4. Share certificate
C. Quasi Negotiable Instruments
1. Bill of lading
2. Dock warrant
3. Carriers receipt
4. Letters of credit
5. Railway receipt
Types of Negotiable Instruments

According to the negotiable Instruments act 1881 there are just three types of Negotiable
Instruments example promissory note, bill of exchange and cheque. However many other
documents have also been recognized as negotiable instruments on the basis of custom and usage
like treasury bills, share warrant etc. They posses the features of Negotiability
Promissory note
A promissory note is an Instrument in writing containing an unconditional undertaking
signed by the maker to pay a certain sum of money to or to the other of a certain person. This
type of a document is called a promissory note.
Features of promissory note
1. A promissory note is unconditional
2. It is always in writing a verbal promise to pay a specified sum of money is not a promissory
note.
3. It is made and signed by the debtor.
4. A promissory note is made as payable in the Currency of the country
5. A promissory note drawn for a specified duration should be adequately stamped According to
its value.
6. A promissory note should be drawn for the payment of a specified sum.
Bill of exchange
A bill of exchange is an Instrument in writing, unconditional order signed by the maker
directing a certain person to pay a certain sum of money only to or to the other of a certain
person or to the bearer of the Instrument.
Features of bill of exchange
1. A bill must be in writing, duly signed by its drawer accepted by its drawee and properly
stamped as per Indian stamp act.
2. It must contain an order to pay words like please pay rs.5000 on demand and oblige are not
used.
3. The order must be unconditional.

4. The order must be to pay money and money alone.

5. The sum payable mentioned must be certain or capable of being made certain.
6. The parties to bill must be certain.
Cheque
A cheque is a bill of exchange drawn on a specified banker and not expressed to be
payable otherwise than on demand. It is an unconditional order in writing be drawn by a
customer on his bank. Requesting the specifying bank to pay on demand a certain sum of money
to a person named in the cheque or to the bearer or to the order of a stated person.
A cheque being a bill of exchange must possess the following requirements.
1. A cheque must be drawn upon a specified banker
2. A cheque must be payable on demand.
3. A cheque must be signed by the drawer.
4. A cheque must be an unconditional order to pay a certain amount of money.
5. A cheque be dated.
Types of cheque
1. Open cheque:- A cheque is called open when it is possible to get cash over the counter at the
bank.
2. Crossed cheque:- Since open cheque is subject to risk of theft it is dangerous to issue such
cheques. This risk can be avoided by issuing other types of cheque called crossed cheque.
3. Bearer cheque:- A cheque which is Payable to any person who presents it for payment at the
bank counter is called bearer cheque.
4. Order cheque:- An order cheque is one which is payable to a particular person. In such a
cheque the word bearer may be cut out or cancelled and the word order may be written. The
payee can transfer an order cheque to someone else by singing his or her name on the back of it..
Quasi Negotiable Instruments

Quasi Negotiable Instruments are those Instruments which can be transferred by

endorsement and delivery but the transferee does not get a better tittle that of the transferor.
Therefore they cannot be classified as negotiable Instruments and hence the negotiable
Instruments act is not applicable to them.

Indian Currency
Name of the Indian Currency: The Indian Currency is called the Indian rupee and the coins are
called paisa. One rupee consists of 100 paisa.
Present denominations of bank notes in India: At Present notes in India are issued in the
denomination of Rs.5, 10, 20, 50, 100, 500 and 1000. These notes are called bank notes as they
are issued by the RBI. The printing of notes in the denominations of Rs.1 and Rs.2 has been
discontinued as these denominations have been coinised. However such notes issued earlier are
still in circulation. The printing of notes in the denomination of Rs.5 had also been discontinued
however it has been decided to reintroduce these notes in order to meet the gap between the
demand and supply of coins in this denomination.
Present available denomination of coins in India: Coins in India are available in
denominations of 50 paisa, one rupees , two rupees , five rupees and ten rupees up to 50 paisa
are called small coins and coins of rupee one and above are called rupee coins.
Can bank notes and coins be issued only in these denominations: Not necessarily. The RBI
can also issue notes in the denominations five thousand rupees and ten thousand rupees or any
other denomination that the central Government may specify. There cannot through be notes in

denominations higher than ten thousand rupees in terms of the current provisions of the RBI act
1934. Coins can be issued up to the denomination of Rs.1000
The role of the RBI in Currency management: The RBI manages Currency in India. The
Government on the advice of the RBI decides on the various denominations. The RBI also
coordinates with the Government in the designing of bank notes including the security features.
The RBI estimates the quantity of notes that are likely to be needed denomination wise and
places the indent with the various security presses through the Government of India. The notes
received from the security presses are issued and a reserve stock maintained. Notes received
from banks and Currency chests are examined. Notes fit for circulation are reissued and the
others are destroyed so as to maintain the quality of notes in circulation. The RBI derives its role
in Currency management on the basis of the RBI act 1934.
The role of Government of India: The responsibility for coinage vests with Government of
India on the basis of the coinage act 1906 as amended from time to time. The designing and
minting of coins in various denominations is also attended to by the Government of India.
Who decides on the volume and value of bank notes to be printed and on what basis: The
RBI decides upon the volume and value of bank notes to be printed. The quantum of bank notes
that needs to be printed broadly depends on the annual increase
In bank notes required for circulation purposes replacement of soiled notes and reserve
requirements.
Who decides on the quantity of coins to be minted: The Government of India decides upon the
quantity of coins to be minted.
How does the reserve bank reach the Currency to people: The RBI manages the Currency
operations through its offices located at Ahmedabad, Bengaluru, Bhopal, Bhubaneswar, Jaipur,
Kanpur, luck now, Mumbai, Nagpur, New Delhi, Patna, and Thiruvananthapuram? These offices
receive fresh notes from the note presses. Similarly the RBI offices located at Kolkata,
Hyderabad, Mumbai and New Delhi initially receive the coins from mints. These offices then
send them to the other offices of the reserve bank. The notes and rupee coins are stocked at the
Currency chests and small coins at the small coin depots. The bank branches receive the bank
notes and coins from the Currency chests and small coin depots for further distribution among
the public.
What is a Currency chest: To facilities the distribution of notes and rupee coins the RBI has
authorized select branches of banks to establish Currency chests . These are actually storehouses
where bank notes and rupee coins are stocked on behalf of the reserve bank. At Present there are

over 4422 Currency chests. The Currency chest branches are expected to distribute notes and
rupee coins to other bank branches in their area of operation.
What is a small coin : Some bank branches are also authorized to establish small coin depots to
stock small coins. There are 3784 small coin deposits spread throughout the country.
What happens when the notes and coins return from circulation: Notes and coins returned
from circulation are deposits at the offices if the reserve bank. The reserve bank then separates
the notes that are fit for reissue and those which are not fit for reissue. The notes which are fit for
reissue are sent back in circulation and those which are unfit for reissue are destroyed after
processing and shredding. The same is the case with coins. The coins with drawn are sent to the
mints for melting
From where can the General public obtain bank notes and coins: Banks notes and coins can
be obtained at any of the offices of the reserve bank and at all branches of banks maintaining
Currency chests and small coin deposits.
Why are Rs.1, Rs.2, and notes not being printed: volume wise the share of such small
denomination notes in the total notes in circulation was as high as 57 percent but constituted only
7 percent in terms of value. The average life of these notes was found a year. The cost of printing
and servicing these notes was thus not commensurate with their life. Printing of these notes was
therefore discontinued. These denominations were Therefore coinised However it has been
decided that notes in the denomination of Rs.5 be re-introduced so as to meet the gap between
the demand and supply of coins in this denomination.
Soiled and mutilated notes: soiled notes are notes which have become dirty and limp due to
excessive use. Mutilated notes are notes which are torn disfigured burnt, washed, eaten by white
ants etc. A double numbered note cut into two pieces but on which both the numbers are in fact is
now being treated as soiled note.
Can such notes be exchanged for value: Yes soiled notes can be tendered at all bank branches
for and exchange obtained.
How much value would one get in exchange of soiled or mutilated notes: Full value is
payable against soiled notes. Payment of exchange value of mutilated notes is governed by the
reserve bank of India rules 1975. These rules have been framed under section 28 of the RBI 134.
What if a note is found to be non-payable: Non-payable notes are retained by the receiving
banks and sent to the reserve bank where they are destroyed.
Where soiled mutilated notes accepted are: All banks are authorized to accept soiled notes
across their counters and pay the exchange value. They are expected to offer these services even

to non-customers. All public sector bank branches and Currency chest branches of private sector
banks are authorized to adjudicated and pay value in respect of mutilated notes. The RBI has also
authorized all commercial bank branches to treat certain notes in two pieces as soiled notes and
pay exchange value.
Special features Introduced in the notes of Mahatma Gandhi series: The new mahatma
Gandhi series of notes contain several special features the notes issued earlier these are:
Latent Image : A vertical band behind on the right side of the mahatma Gandhi portrait which
contains which contains latent image showing the denominational value 20, 50, 100, 500, 1000
as the case may be.

Financial and Banking Sector Reforms in India

Introduction
India has had more than a decade of Financial sector reforms during which there has been substantial
Transformation and liberalization of the whole Financial system
Objectives of Financial sector reforms in India.

1. Reforms Financial repression that existed earlier

2. Create an efficient productive and profitable Financial sector industry
3. Enable price discovery particularly by the market determination of interest rates that then helps in efficient
allocation of resources
4. Provide operational and function autonomy to institutions
5. Prepare the Financial system for increasing international Competition
6. Open the external sector in a calibrated fashion
Narasimham committee report 1991 &1998
The narasimham committee was set up in order to study the problems of the indian Financial system and to
suggest some recommendations for improvement in the efficiency and productivity of the Financial institution
The committee had given the following major recommendations:
1. Reduction in SLR and CRR : The committee recommeded the Reduction of the higher proportion of the
statutory liquidity ratio and cash reserve ratio . Both of these ratios were very high at that time. The SLR the
was 38.5 percent and crr was 15 percent . This high percentage of SLR and CRR meant locking the bank
resources for govt uses. SLR was recommeded to be from 38.5 to 25 percent and CRR from 15 percent and 3.5
percent
2. Phasing out of directed Credit programme : in india since Nationalization directed Credit programmes
were adopted by the Government . The committee recommed Phasing out of this programme. This programme
compelled banks to earmark their Financial resources for the needy and poor sectors at concessional rates of
interest
3. Interest rate determintaion: The committee felt that the interest rates in india were regulated and
controlled by the authorities . The committee recommeded eliminating Government controls on interest rates
and Phasing out the concessional interest rates for the priority sector.
4. Structural re organizations of the banking sector: The committee recommeded that the actual number of
public sector banks need to be reduced. Three to four large banks including SBI should be developed as
international banks. Eight to ten banks having nationwide presence should concerntrate in the National and
unverisal banking services.
Local banks should concerntrate on region specific banking . Regarding RRBs it recommeded that they should
focus on agr culture and rural financing

5. Establishment of the ARF and tribunal: The proporation of bad debts and non performing assets of the
public banks and Development Financial institute was veey alarming in those days. The committee
recommeded the Establishment of an assets reconstruction fund . This fund would take over the proporation of
the bad and doubt ful debts from the banks and Financial institutes. It would help banks to get rid of bed debts.
6. Removal of dual control : The committee recommeded the stopping of this system. it considered and
recommeded that the RBI should be the only main agency to regulate banking in india
7. Banking autonomy : The committee recommeded that the public sector banks should be free and
autonomous. Banking technology upgradation would thus be easy.
Narasimham committee report II 1998
In 1998 the Government appointed yet another committee under the chairmanship of Mrt.Narasimham. It
better known as the banking sector committee. It was told to review the banking reform progress and design a
programme for further strengthening the Financial system of india the committee focused on various areas
such as capital adequacy bank mergers bank legislation,
It submitted its report to the Government in April 1998 with the following recommendations:
1. Strengthening the banks in india
2. Narrow banking
3. Capital adequacy ratio
4. Bank owership
5. Review of banking laws
Apart from these major recommendations the committee has also recommended faster computerization ,
technology upgradation , training of staff, depoliticizing of banks, professionalism in banking , reviewing bank
recruitment etc.

MICRO, SMALL AND MEDIUM ENTERPRISES (MSME)

In accordance with the provision of MSMED Act, 2006, the Micro, small and Medium
Enterprise are classified as follow:
1. Manufacturing Enterprises The enterprise engaged in the manufacturing of goods
pertaining to any industry specified in the first schedule to the industries (Development and
regulation Act,1951) or employing plant and machinery in the process of value addition to the
final product having a distinct name or character or use. The manufacturing Enterprise is defined
in terms of investment in Plant & Machinery.
2. Service Enterprises: The enterprise engaged in providing or rendering of services and are
defined in terms of investment in equipment.
Manufacturing Sector

Investment in Plant & Machinery

Enterprises

Micro Enterprises
Does not exceed 25lakhsSmall Enterprises
More than 25 lakhs but less than 5 croreMedium Enterprises
More than 5 crore but less than 10 crore
Service Sector

Enterprises
Micro Enterprises

Investments in equipments
Less than 10lakhs

Small EnterprisesMore than 10lakhs less than 2crores

Medium EnterprisesMore than 2crores less than 5crores

Automated Teller Machine (ATM)

Automated Teller Machine (ATM) is a computerized machine that provides the customers the facility of
checking balance, withdrawing and transferring the funds without visiting the branch of the bank

Important Points to Remember:

Technology Used: Broadband Integrated Service Digital network (BISDN)
Operating systems used in ATMs Primarily: Windows XP Professional and Windows XP Embedded
Communication Mode: Both Data and Voice
Operates on: layer 2 in OSI Model (Data Link Layer)
Connection Mode: Point-to-Point
Size of ATM Cells: 53 Bytes (48 bytes of data and 5 bytes of header information)
Facilities available at ATMs

Account Information

Cash Deposit

Regular bills payment

Purchase of Re-load Vouchers for Mobiles

Mini/Short Statement

Loan account enquiry

There are two types of cards supported by ATM

ATM Debit Card

Credit Card

ATM Debit Card:

ATM Debit Card is card given by bank to access your account easily using a machine called Automated Teller
Machine (ATM). Debit cards can be used for shopping purposes, without carrying the money. You can use
Debit cards while purchasing, but you must have money in your account. Purchased amount will be deducted
immediately from your account.
Advantages:

No need to carry money with you

You can use it for shopping purpose

No need of filling withdrawal and deposit slips

Money Security: No one can access it without knowing PIN Number

You can access your account from any corner of the world, no need to visit bank
branch

Availability (24*7 Services)

Disadvantages:

Sometimes you may face Server-Down Problem

Forgetting of Pin Number

Fees charged for using card in different bank may be expensive

Limitation of cash withdrawal

Credit Card:
Credit card is different from debit card, in debit card you must have money for using it. But for using credit
cards, its not necessary. If you use credit card for purchasing purposes it does not deduct your money
immediately.
Bank will pay the vendors and sends the bill to the customer every month.