Topic 5 Online Payment.pptVIP

Online Payment Types of Online Payment Online Payment Processing Online Fraud Identifying E-payment Options What are the options for electronic payment? The methods used to pay for products and services online include credit cards, digital cash / e-wallets (micro payments) and smart cards. PayPal and AliPay are Payment Service Providers (PSP), allowing a 3rd party to complete the online transaction. Credit Cards A credit card provides a consumer with a preset spending limit (credit limit) such as $2000, $5000, or $10000. Research shows that up to 90 percent of all consumer transaction are made with a credit card such as Visa or Master card. Credit Card Issues For an online business, credit card transaction are essential for fiscal survival. On the negative side, a wide range of costs are involved in processing credit card payments. In addition, companies are increasingly concerned about the risk of fraud that results from the anonymity made possible by buying on the Internet. Credit Card Issues The use of the card verification number (CVN) detects fraud by comparing the verification number printed on the signature strip on the back of the card with the information on file with the cardholders issuing bank. E-payment System Credit Card Service Provider Electronic Wallets Electronic Wallets, or e-wallets, are also referred to as digital wallets. An e-wallet is a software program that contain a user’s payment information in encrypted form to ensure its security. Digital Cash / E-cash Digital cash consumers deposit money into digital cash accounts for use in digital transactions; often used with e-wallets; allowing people without credit cards to shop online; possible to make micro payments Exploring E-cash One advantage of e-cash is that it can be spent in very small increment, called micro payments. Because most credit cards can’t handle payment under $1.00 or even $5.00, people might start using e-cash to make payments in very small amounts, such as 10 or 20