1 / 21

E-Commerce

E-Commerce . Payment Options. By Laura Kinchen. Traditional Payment Methods. Payment: The transfer of money from one individual or legal entity to another Cash Personal Cheques Money orders (Bank note) Credit cards Debit cards. Requirements of E Payment Methods.

katyr
Télécharger la présentation

E-Commerce

An Image/Link below is provided (as is) to download presentation Download Policy: Content on the Website is provided to you AS IS for your information and personal use and may not be sold / licensed / shared on other websites without getting consent from its author. Content is provided to you AS IS for your information and personal use only. Download presentation by click this link. While downloading, if for some reason you are not able to download a presentation, the publisher may have deleted the file from their server. During download, if you can't get a presentation, the file might be deleted by the publisher.

E N D

Presentation Transcript

  1. E-Commerce Payment Options By Laura Kinchen

  2. Traditional Payment Methods Payment: The transfer of money from one individual or legal entity to another • Cash • Personal Cheques • Money orders (Bank note) • Credit cards • Debit cards

  3. Requirements of E Payment Methods • Enable an honest customer to convince a seller to accept payment • Prevent a dishonest customer from making unauthorized or fraudulent payments • Ensure the privacy of honest participants • Scalable to very large numbers of customers • Integrate with existing and evolving systems

  4. Pros and Cons of E-Payment • Pros: • Potential for great flexibility • Low transaction costs • Rapid and diverse purchase power • Cons: • Perfect copying of transactions is possible • Vulnerability to world-wide attack • Lack of anonymity, potential for privacy intrusion

  5. E-Payment Methods • Credit and Debit card • Smart card • Digital Currency/Electronic Cash • E-Wallets • Peer-to-Peer Methods • Micro-payments • B2B

  6. Credit-Cards • Credit card • Used for the majority of Internet purchases • Has a preset spending limit • Currently most convenient method • Most expensive e-payment mechanism • MasterCard: $0.29 + 2% of transaction value • Disadvantages • Does not work for small amount (too expensive) • Does not work for large amount (too expensive) • Charge card • No spending limit • Entire amount charged due at end of billing period

  7. Credit Card Process • Merchants must set up merchant accounts to accept payment cards • Law prohibits charging payment card until merchandise is shipped • Payment card transaction requires: • Merchant to authenticate payment card • Merchant must check with card issuer to ensure funds are available and to put hold on funds needed to make current charge • Settlement occurs in a few days when funds travel through banking system into merchant’s account

  8. Using a Credit Card on the Web SOURCE: PAYMENT PROCESSING INC.

  9. Credit Card Fraud • Fraud is a major problem for E-commerce • The merchant has no legal proof of purchase unless the buyer uses authentication certificate • Companys such as Visa, nochargeback.com and CyberCash (now VeriSign) are working to limit fraud: • Visa has established high risk business models and best practices info for merchants • Nochargeback.com has lists of fraudlent cards, e-mail addresses and postal addresses

  10. Smart Cards • Cards with computer chips embedded on their faces – very common in Europe • Used for health care, transportation, ID, retail, pay phones, loyalty programs, banking machines • Smart card readers interface with card and request user PIN for access • Bank machines can load cards with cash and then merchants can download cash from card • Returns anonymity of purchase to customer

  11. Smart Cards • Ticketless travel • Authentication, ID • Medical records • Ecash • Store loyalty programs • Personal profiles • Government • Licenses • Mall parking

  12. Pros and Cons of Smart Cards • Advantages: • Atomic, debt-free transactions • Feasible for very small transactions (information commerce) • (Potentially) anonymous • Security of physical storage • (Potentially) currency-neutral • Disadvantages: • Low maximum transaction limit (not suitable for B2B or most B2C) • High Infrastructure costs (not suitable for C2C) • Single physical point of failure (the card) • Not (yet) widely used

  13. Digital Currency/E-Cash • Digital cash accounts like traditional bank accounts • Buyers deposit cash in the account and spend it at E-commerce sites (acct # is passed using secure proprietary protocol) • E-commerce merchants can feel sure of payment • Customers do not need a credit card and spending is limited to account balance

  14. E-Cash Structure Merchant 1. Consumer buys e-cash from Bank 2. Bank sends e-cash bits to consumer (after charging that amount plus fee) 3. Consumer sends e-cash to merchant 4. Merchant checks with Bank that e-cash is valid (check for forgery or fraud) 5. Bank verifies that e-cash is valid 6. Parties complete transaction: e.g., merchant present e-cash to issuing back for deposit once goods or services are delivered Consumer still has (invalid) e-cash 5 4 Bank 3 2 1 Consumer

  15. Pros and Cons of E-cash • Advantages • More efficient, eventually meaning lower prices • Lower transaction costs • Anybody can use it, unlike credit cards, and does not require special authorization • Disadvantages • Tax trail non-existent, like regular cash • Money laundering • Susceptible to forgery

  16. E-Wallets • Established by financial institutions in partnership with member E-Commerce sites • Allows customer to submit billing and shipping info with one click at member sites • Also can store e-Cheques, e-Cash and credit card information • Makes shopping easier and more efficient • Eliminates need to repeatedly enter identifying information into forms to purchase • Works in many different stores to speed checkout • Amazon.com one of the first online merchants to eliminate repeat form-filling for purchases

  17. Examples of E-Wallets • Agile Wallet • Developed by CyberCash • Allows customers to enter credit card and identifying information once, stored on a central server • Information pops up in supported merchants’ payment pages, allowing one-click payment • Does not support smart cards or CyberCash, but company expects to soon • eWallet • Developed by Launchpad Technologies • Free wallet software that stores credit card and personal information on users’ computer, not on a central server; info is dragged into payment form from eWallet • Information is encrypted and password protected • Works with Netscape and Internet Explorer

  18. Person-to-Person Method • Digital cash via email (eCash.com) • PayPal.com – digital payment system • Acts as a trusted third party (e.g. auction purchase) • To send money: • Sender sets up an account and requests to send payment • Sender places payment into the receivers account by credit-card • Reciever is notified of payment via email • Receiver can transfer funds to bank account or request a cheque • There is also a request payment method • FOR FREE .. ? What is the their business model ?

  19. Micro-Payments • Long distance phone call charge is an example of a micro-payment • Digital Equipment Corporatiion (DEC) researchers originally envisioned MPs: • Payment per newspaper article ($0.005) • Payment by stock quote ($0.001) • Payment per click (Qpass, Inc)

  20. The Fall of Micro-Payments • Overly complicated for customer and business – technology & accounting • Income is very dependent on customer use (difficulties in cashflow management) • Customer anxiety – could act as a deterent • Difficulties in standardization – lost of different approaches, variant media

  21. B2B (Business to Business) • B2B transactions are the fastest area of $ growth on the web • B2B transactions are substantially larger than B2C • Paymantech is major provider: • 24/7 availability, all manner of EFT supported • many management tools and reporting methods • Ecredit.com offers real-time automated credit approval and financing • TradeCard offers comprehensive B2B E-commerce facilities on an international scale

More Related