As a customer in the banking industry, you may have come across the term EDC while carrying out transactions, and you are left wondering what it means. This article aims to shed light on the EDC full form and meaning in banking.
Electronic Data Capture (EDC) is a term commonly used in the banking industry. It refers to the process of capturing and recording customers’ payment card details, such as debit or credit card, during a transaction. The EDC machine reads the card details, authorizes the transaction and electronically transfers the funds from the customer’s account to the merchant’s account.
What is EDC?
EDC stands for Electronic Data Capture. It is a device used to capture and record customers’ payment card details during a transaction. EDC machines are commonly used in the banking industry to facilitate cashless transactions. They offer convenience and ease of use for both merchants and customers. EDC machines come in various forms, depending on the technology used.
Types of EDC machines
There are different types of EDC machines, and they include:
Wired EDC machines
These EDC machines are connected to a power source and a telephone line to communicate with the banking system. They have a fixed location and are ideal for businesses with a fixed point of sale, such as supermarkets and retail stores.
Wireless EDC machines
Wireless EDC machines are portable and do not require a telephone line or power source. They rely on cellular networks to communicate with the banking system, making them suitable for businesses with a mobile point of sale, such as food trucks and market vendors.
Mobile EDC machines
Mobile EDC machines are similar to wireless EDC machines, but they come with a mobile application that allows merchants to accept payments using their mobile devices. These machines are ideal for small businesses and home-based businesses.
How does EDC work?
EDC machines work by capturing and recording customers’ payment card details, such as debit or credit card information. During a transaction, the EDC machine reads the card information, authorizes the transaction and electronically transfers the funds from the customer’s account to the merchant’s account.
Benefits of using EDC
Using EDC machines comes with several benefits, and they include:
- Convenience: EDC machines offer a convenient way for customers to make payments without the need for cash or cheques.
- Speed: Transactions processed through EDC machines are faster compared to other payment methods.
- Security: EDC machines come with security features that protect customers’ payment card information and prevent fraud.
- Accuracy: EDC machines record transactions accurately, reducing the risk of errors and disputes.
- Increased sales: EDC machines can increase sales for merchants by offering customers an additional payment option.
EDC transactions limits
EDC transactions are subject to limits, and they vary depending on the merchant’s business type and the bank. Customers are advised to check with their bank and the merchant’s bank for the transaction limits.
Security features of EDC machines
EDC machines come with several security features to protect customers’ payment card information and prevent fraud. Some of these features include:
- Chip and PIN technology: EDC machines with Chip and PIN technology offer an additional layer of security by requiring customers to enter a personal identification number (PIN) to authorize transactions.
- Encryption: EDC machines encrypt customers’ payment card information, making it difficult for fraudsters to intercept and steal the data.
- Fraud detection: EDC machines have built-in fraud detection mechanisms that flag suspicious transactions and alert the merchant and the bank.
- EMV compliance: EDC machines are required to be EMV compliant, which means they meet the security standards set by Europay, Mastercard, and Visa.
Comparison of EDC machines with other payment methods
EDC machines have several advantages over other payment methods, such as cash and cheques. Here is a comparison of EDC machines with other payment methods:
- Cash: EDC machines offer a cashless payment option, eliminating the need to carry cash and the risk of theft.
- Cheques: EDC machines process transactions electronically, eliminating the need for cheques and the associated paperwork and processing time.
Factors to consider before choosing an EDC machine
When choosing an EDC machine, there are several factors to consider, and they include:
- Business type: The type of business you run will determine the type of EDC machine that suits your needs.
- Transaction volume: If your business processes a high volume of transactions, you need an EDC machine that can handle the load.
- Connectivity: Depending on your location, you may require an EDC machine that can connect to cellular networks or a landline.
- Compatibility: Your EDC machine should be compatible with your point of sale system and the payment cards you accept.
Fees and charges associated with EDC machines
EDC machines come with fees and charges, and they vary depending on the bank and the type of EDC machine. Some of the common fees and charges include:
- Transaction fees: Banks charge a percentage of the transaction amount as a fee.
- Monthly rental fees: Merchants pay a monthly rental fee for the use of the EDC machine.
- Setup fees: Some banks charge a one-time setup fee when you apply for an EDC machine.
- Maintenance fees: Banks charge a maintenance fee for the upkeep of the EDC machine.
How to apply for an EDC machine
To apply for an EDC machine, you need to follow these steps:
- Contact your bank and inquire about their EDC machines and the application process.
- Provide the required documents, such as proof of identity, proof of business registration, and bank statements.
- Wait for the bank to process your application.
- Once approved, the bank will install the EDC machine at your business location.
FAQs on EDC
The full form of EDC in banking is Electronic Data Capture.
EDC machines capture and record customers’ payment card details, authorize transactions and electronically transfer the funds from the customer’s account to the merchant’s account.
EDC machines offer convenience, speed, security, accuracy and can increase sales for merchants.
EDC machines have several security features, such as Chip and PIN technology, encryption, fraud detection, and EMV compliance.
To apply for an EDC machine, you need to contact your bank, provide the required documents, and wait for the bank to process your application.
Yes, EDC machines can be used for online transactions as long as they are compatible with the merchant’s payment gateway and the customer’s payment card.
If an EDC machine malfunctions during a transaction, the merchant should contact their bank or financial institution immediately to resolve the issue and ensure the transaction is completed successfully.
In conclusion, EDC machines have revolutionized the banking industry by offering a cashless payment option that is convenient, fast, secure, and accurate. Merchants and customers can benefit from using EDC
machines, and banks can increase their revenue by offering these services to their customers. Before choosing an EDC machine, it is important to consider factors such as the type of business, transaction volume, connectivity, and compatibility.
EDC machines come with fees and charges, and merchants should be aware of these costs before applying for one. Overall, EDC machines are a valuable tool for businesses and banks alike, and they have made transactions easier and more convenient for everyone involved.
If you’re interested in learning more about EDC machines and their benefits, contact your bank or financial institution to inquire about their EDC services.