– How is money from online transactions sent to the receiver?

Question

I’ve always thought of the money in my bank as a numerical value that could easily be changed by adding just one 0 at the end if you know what I mean.

If paper cash has value, then how does the bank transfer the money so that the receiver has value? Do they deliver the paper cash physically after an online transaction? Does the money online have some sort of “token” that gives it value so that it cannot be changed with the click of a button?

In: Other

Answer 1

Nope, it’s just bits in a database. In fact, most of the cash in modern economies is just that – purely digital. Most estimates for a modern economy will say that only 10% of all the “money” in the economy is paper. The rest of it is just records in a database somewhere.