I am working at a digital banking company i.e company that provides software for banks so that the customers of that bank can use banking services via smartphone.
But the documentation there is non-existent. I am always confused about the working of the various types of payments like:
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How does transfer of fund between same banks occur?
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How does transfer of fund between different banks occur?
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How does transfer of fund via QR transfer occur?
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How does money gets topped up in smartphone?
And so many. I’ve a gist about this but no matter how much I look at logs, I can’t exactly trace out the flow. I’ve asked with senior colleagues and they too just know what I know i.e abstract view. I don’t have access to the codebase as I’m a sysadmin(I think it’d help me). It’s been a long time(5 months) since I joined this job and now I’m too afraid to ask about it to developers!
Is there something that I can ready like a textbook or something? I’m a cs grad so I’ve decent idea about subjects like “software architecture and engineering”. Are system design books helpful in my case? I don’t think these systems are anything out of the ordinary, but I need to understand the flow of architecture of these apps properly on minute basis. From hitting a reverse proxy to connecting with core banking system.
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The internal operations of banks first started to be computerised in the 1960s, and proceeded aggressively in the 1970s. Keeping the books hasn’t been done on paper for decades.
So I’m not exactly sure what a “digital banking system” is, as distinct from any ordinary banking system as we know it.
How does transfer of fund between same banks occur?
When transferring money within the same bank, the bank simply makes entries into its own books (or “ledger”), debiting one account and crediting the other.
How does transfer of fund between different banks occur?
There are a large number of schemes, but most commonly each bank maintains an account with the other – called a correspondent account – and they synchronise entries not only into their respective customer accounts but also into their own correspondent accounts.
The effect is that the transfer is not direct, as it is for a same-bank transfer.
Periodically (possibly several times a day nowadays, but the frequency needn’t be daily, or regular in time), the banks “settle” the net difference of their correspondent accounts which may have accumulated.
They needn’t necessarily do this settlement directly – they can also settle via a third correspondent that is common between them, such as the central bank of the state.
How does transfer of fund via QR transfer occur?
It would depend on the scheme, but if it involves a bank to bank transfer, then it presumably triggers a transfer in the ordinary way.
Alternatively, it may be achieved via electronic payment infrastructure (like Visa or MasterCard), the details of which are more complicated again, but involve the same essential relationships of banks (or financial institutions more broadly) and correspondent accounts to bridge any gap between banks.
How does money gets topped up in smartphone?
Companies maintain a system of “client accounts” or “customer accounts”, very similar essentially to what banks do.
When “topping up”, the company takes your cash or receives a transfer (or accepts a promise from a financial institution), and records that receipt (or “receivable”) in their ledger, and also credits your customer account in their ledger.
Is there something that I can ready like a textbook or something?
Yes, the basics would be covered in an accountancy textbook.
Every ordinary business is essentially involved in transferring money to other businesses, often via the accounts each holds with a bank.
The bank account that an ordinary business holds with its own bank, is basically the analogy of the “correspondent account” that banks hold with each other, and the interactions (like settlement, reconciliation, and so on) are similar in principle.
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