Thailand August September 2006

Module 7: Banking and Finance 
Alan Davidson  

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Finance, Banking and Internet Transactions
The Australian Financial System 
(The Wallis Report)
Read Quirk, chapter 5.
Browse Akindemowo, pages 75-86 *
Download "Payment Systems in Australia" prepared by the Reserve Bank of Australia and the Committee on Payment and Settlement Systems of the central banks of the Group of Ten countries.  It may be downloaded here: 

        Payment Systems in Australia

[Note 'pdf' files. To initially access and read the material the user will need to download a copy of a browser which manipulates 'pdf' files. See Adobe Acrobat Reader or Exchange 3.0 or later. Version 2.1 of Reader or Exchange sometimes has difficulty in interpreting files created in version 3.0. Adobe Acrobat Reader may be downloaded from: br> http://www.adobe.com/products/acrobat/readstep.html

http://www.bankers.asn.au/3_level/evo.htm

Read pages 3-13 of the "Payment Systems in Australia" 

See Financial System Inquiry Final Report (Wallis Report) Overview 
http://www.treasury.gov.au/publications/
FinancialSystemInquiry%28WallisReport%29/FinalReport/overview.pdf
Read pages 1-5; 11-14; 26-30 
Browse 6-11; 14-25

Financial System Inquiry Final Report (Wallis Report) Recommendations 
http://www.treasury.gov.au/publications/
FinancialSystemInquiry%28WallisReport%29/FinalReport/recomm.pdf
Skim  read recommendations 1-3; 27-29; 56-57; 61-78; 91-94; 100-101; 113-115. 
Browse the remainder

Summary of Wallis Report 
Read 
http://www.law.usyd.edu.au/~alant/wallis-report.html

PART 2 

Read Akindemowo’s article regarding electronic value and the concept of money 
http://www.austlii.edu.au/do/disp.pl/au/other/unswlj/thematic/
1998/vol21no2/akindemowo.html

Read sections 34-37, 44, Reserve Bank Act 1959 (Cth) 
http://www.austlii.edu.au/do/disp.pl/au/legis/cth/consol_act/rba1959130/

Read sections 16,17 & 22 Currency Act 1965 (Cth) 
http://www.austlii.edu.au/au/legis/cth/consol_act/ca1965120/

Read sections 10-11, Unclaimed Moneys Act 1950 (ACT) 
http://scaletext.law.gov.au/html/actord/0/357/top.htm

Read section 69 Banking Act 1959 (Cth) 
http://www.austlii.edu.au/au/legis/cth/consol_act/ba195972/s69.html

Browse the results of a search in AustLII at for "unclaimed money" in "Commonwealth consolidated legislation". 
 

Payment Instruments Recognised Under the Australian Financial System

Cheques

Quirk p 115, 119-123

Browse Akindemowo, pages 92-99

Read s 2.2.1 "Payment Systems in Australia", page 10 
 

Direct entry (DE)

Quirk 122

Browse Akindemowo, page 106 

Read Direct Entry portion "APCA Payment Instruments" 
http://www.apca.com.au/Paymentinstruments.htm

Read s 2.2.2, "Payment Systems in Australia" page 10-1
 

Electronic Data Interchange (EDI)

Quirk 59; 122

Browse Akindemowo, page 107 

Read EDI portion "APCA Payment Instruments" 
http://www.apca.com.au/Paymentinstruments.htm
 

Automated Teller Machines (ATM's)

Forder p 121

Browse Akindemowo, pages 99-100 

Read ATM portion "APCA Payment Instruments" 
http://www.apca.com.au/Paymentinstruments.htm

Read s 2.2.4, "Payment Systems in Australia" page 11 
 

Payment (Credit / Debit) cards

Quirk 120-1

Read pertinent portion "APCA Payment Instruments" 
http://www.apca.com.au/Paymentinstruments.htm

Read s 2.2.3, "Payment Systems in Australia" page 11 
 

Electronic Funds at Point of Sale (EFTPOS)

Quirk 121

Browse Akindemowo, pages 100-106 

Read pertinent portion "APCA Payment Instruments" 
http://www.apca.com.au/Paymentinstruments.htm
 

Stored value cards (SMART cards, etc.)

Quirk 124

Browse Akindemowo, pages 118-121 

Read pertinent portion "APCA Payment Instruments" 
http://www.apca.com.au/Paymentinstruments.htm 

Read Virtual Cash by A. Tyree 
http://www.law.usyd.edu.au/~alant/netpay.html
http://www.law.usyd.edu.au/~alant/netpay2.html
http://www.law.usyd.edu.au/~alant/netpay3.html

Browse Tyree’s article on smart cards and electronic purses 
http://www.law.usyd.edu.au/~alant/smrtcrds.html

Clearing House Electronic Subregister System (CHESS)

Browse Akindemowo, page 111 

  Financial Transactions Recording and Clearance System (FINTRACS)

Read pertinent portion at
http://www.apca.com.au/Paymentinstruments.htm

Read pertinent portion "Payment Systems in Australia" at pages 21-22 (See above) 
 

Reserve Bank Information and Transfer System (RITS)

Read pertinent portion 
http://www.apca.com.au/Paymentinstruments.htm

Read pertinent portion "Payment Systems in Australia" at pages 20-21 (See above) 
 

High Value Electronic Payments

Read pertinent portion "APCA Payment Instruments" 
http://www.apca.com.au/Paymentinstruments.htm
 

Electronic Bills of Exchange

Read Gamertsfelder’s excellent article 
http://www.austlii.edu.au/au/other/unswlj/thematic/1998/vol21no2/gamertsfelder.html

Credit Cards

Credit was first used in Assyria, Babylon and Egypt 3000 years ago. The bill of exchange - the forerunner of banknotes - was established in the 14th century. Debts were settled by one-third cash and two-thirds bill of exchange. Paper money followed only in the 17th century.

The first advertisement for credit was placed in 1730 by Christopher Thornton, who offered furniture that could be paid off weekly.

From the 18th century until the early part of the 20th, tallymen sold clothes in return for small weekly payments. They were called "tallymen" because they kept a record or tally of what people had bought on a wooden stick. One side of the stick was marked with notches to represent the amount of debt and the other side was a record of payments. In the 1920s, a shopper's plate - a "buy now, pay later" system - was introduced in the USA. It could only be used in the shops which issued it.

The history of bank cards dates back to 1914. That year, Western Union issued the first consumer credit card. These early cards were issued to preferred company customers to offer them an array of special services, including interest-free deferred payments. 

In the first decades of the 20th century, a large number of non-financial companies, including hotels, department stores and gas companies, issued credit cards to their customers. The Diners Club card, introduced in 1950, was the first credit card accepted by different merchants.

In 1950, Diners Club and American Express launched their charge cards in the USA, the first "plastic money". In 1951, Diners Club issued the first credit card to 200 customers who could use it at 27 restaurants in New York. But it was only until the establishment of standards for the magnetic strip in 1970 that the credit card became part of the information age.

After the US Civil War, the whole country felt shaky about using paper money as legal tender instead of notes backed by gold or silver. It took 30 years to settle on the current currency. 

PART 3 

Read the article on E-Payments and Australian Regulation * 
http://www.austlii.edu.au/do/disp.pl/au/other/unswlj/thematic/1998/vol21no2/beatty.html

Browse Pollard’s article on electronic payment 
http://www.gtlaw.com.au/pubs/elecpay.html 

Read the article on Internet Billing 
http://www.businessweek.com/cgi-bin/ebiz/ebiz_frame.pl?url=/ebiz/9911/ep1108.htm

Browse Regulating Internet Payment by Alan Tyree 
http://www.law.usyd.edu.au/~alant/payment-reg-1.html

http://www.law.usyd.edu.au/~alant/payment-reg-2.html

http://www.law.usyd.edu.au/~alant/payment-reg-3.html
 

Access Regime

Read Sections 7-10, 12, 21, 22, the Payment Systems (Regulation) Act 1998 (Cth) 
http://www.austlii.edu.au/au/legis/cth/consol_act/psa1998333/index.html
 

Payment Systems and Netting Arrangments

Read Sections 5, 8-12, the Payment Systems and Netting Act 1998 (Cth) 
http://www.austlii.edu.au/au/legis/cth/consol_act/psana1998319/index.html
 

Payment Clearing Systems

Read Electronic Clearing and Settlement article by Alan Tyree 
http://www.law.usyd.edu.au/~alant/banklaw.html

Read Crede’s article on payment settlement systems 
http://www.ascusc.org/jcmc/vol1/issue3/crede.html 
 

Australian Paper Clearing System (APCS)
Reference 
http://www.apca.com.au/Paymentsystems.htm
 

Bulk Electronic Clearing System (BECS) 
Reference 
http://www.apca.com.au/Paymentsystems.htm
 

Consumer Electronic Clearing System (CECS) 
Reference 
http://www.apca.com.au/Paymentsystems.htm
 

High Value Clearing System (HVCS) 
Reference 
http://www.apca.com.au/Paymentsystems.htm
 

Reporting of Commercial Transactions

Read Sections 7, 8, 8A, 18, 20, 20A, Financial Transactions Reports Act 1988 (Cth) 
http://www.austlii.edu.au/au/legis/cth/consol_act/ftra1988308/index.html

Read sections 3, 71-73, Proceeds of Crime Act 1987 (Cth) 
http://www.austlii.edu.au/au/legis/act/consol_act/poca1991160/index.html

Part 4 

Effects - Purpose
Examples
Codes of Conduct 

Browse Akindemowo, pages 78-79
Smart Card Code of Conduct 

Browse Akindemowo, pages 120-121

Read the introduction to the Smart Card Code of Conduct 
http://www.aeema.asn.au/apscfcode.htm
Browse Code of Banking Practice 
http://www.bankers.asn.au/ABA/Online/netscapedefault.asp?DeptID=4&SubDeptID=&ArticleID=95

SINGAPORE (Case example -  Reference)

Monetary Authority of Singapore 
http://www.mas.gov.sg/

Monetary Authority of Singapore Act (MASA); and 
Banking Act (SBA) 
http://www.gbld.org/index.asp?mode=21&country=32
http://www.gbld.org/downloads/Singapore/MASA.pdf

Baker and McKenzie Notes 
http://www.bmck.com/ecommerce/singapore.htm

General 
http://www.gksoft.com/govt/en/sg.html