Means of payment – Definition, what it is and concept

A means of payment is an instrument that allows you to buy a product, hire services or cancel all kinds of debts.

Therefore, we can say that it is a good, such as money, or an instrument, such as a credit card, that allows you to buy something or pay a debt. Money, in fact, serves as a means of payment and as a means of exchange and even as a form of savings. In recent decades, a multitude of instruments considered this way and more have been born with the proliferation of the Internet.

Origin of payment methods

Before the rise of money was the barter which allowed the goods to be exchanged with each other. Over time the coins and bills appeared. These had their antecedents in products such as salt and later in precious metals such as gold and silver.

But everything is evolution and the money gave rise to other more sophisticated ways of paying for goods or hiring services. Debit or credit cards are a clear example. With digital development, there are other instruments such as Internet payment platforms. All of them have the objective of facilitating economic transactions.

It is not a medium of change

A medium of exchange serves a time and place, facilitating commercial exchanges. When we talk about means of payment for a good or service, in this case these instruments should be used at any place and time. Therefore, the principal is money and its equivalents, such as a check, although this has more limitations.

Examples of means of payment

Among the most prominent examples of payment methods are:

  • The money, coins and bills that, as we have already mentioned, in turn acts as a medium of exchange.
  • Checks, in all its modalities.
  • The debit cards or credit
  • Internet payment instruments such as Paypal are also means of payment.