Binary Coded Decimal system (BCD code) is an efficient encoding scheme and BCD arithmetic operation can be performed on signed/unsigned BCD. The BCD numbering system is an encoding scheme of representing decimal numbers using 4 bits for each of the decimal digit that is not only fast as compared to pure binary system but also occupies less memory. But the BCD code is wasteful as many of the 4-bit states (10-to-16) are not used but decimal displays have important applications. However, the BCD code is wasteful as it wastes 6 out of 16 combinations and it has a natural application in decimal display systems. This video talks at length about Binary coded decimal system and its arithmetic operation that it can perform.