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E-commerce: Electronic payment systems I/ Introduction

Electronic commerce, commonly known as e-commerce, ecommerce or e-commerce, consists of the buying and selling of products or services over electronic systems such as the Internet and other computer networks. It is more than just buying and selling products online. It also includes the entire online process of developing, marketing, selling, delivering, servicing and paying for products and services. The amount of trade conducted electronically has grown extraordinarily with widespread Internet usage. The use of commerce is conducted in this way, spurring and drawing on innovations in electronic funds transfer, supply chain management, Internet marketing, online transaction processing, electronic data interchange (EDI), inventory management systems, and automated data collection systems. Modern electronic commerce typically uses the World Wide Web at least at some point in the transaction's lifecycle, although it can encompass a wider range of technologies such as e-mail, mobile devices and telephones as well. Electronic Payment Systems (EPS) is on making your business more profitable by providing you with the best merchant processing services. We offer a wide range of credit card processing solutions from point-of-sale terminals, online e-commerce systems, and online account reporting to check verification services. EPS is the nation's leader in merchant credit card services and we want the opportunity to prove it to you! EPS provides complete point-of-sale merchant processing payment solutions for all business types. Whether your business is online, over the phone or located in a store, EPS is your answer. EPS provides low processing rates, terminal leasing and cash deals. With 24/7 in-house customer and technical support provided for all of our services, you don't have to track down the answers to your questions. By accepting credit, debit and EBT card processing, you can increase your business's bottom line by allowing more customers to use a wider range of payment options.

Follow this research you will find more detail and knowledge about one of the most common way to trading in the world.

II/ Literature review

A. B.

What is Electronic payment system? Types of electronic payment systems?

1. Online credit card payment a) Definition: Online credit cards are the same thing as regular credit cards but with the

added advantage of being able to manage your account online--an important addition to regular credit cards. Online credit cards are also accompanied by the physical plastic credit card that is shipped to the holder's mailing address on file
b) Advantages: y

Ability to Track Charges Online

Once logged into your credit card account screen, a click of your computer mouse will reveal all your credit card data on the computer screen. You can see even a charge you made few minutes ago. This advantage makes it easy to keep up with current charges to the account. It also makes it easier to detect fraudulent charges to your credit card account as well as recognize possible identity fraud. y Easy to Manage

The task of overall management of credit cards could be problematic without the ability to access your information online. Before the advent of online credit cards, credit card statements were usually mailed from the credit card company once a month. But the online credit card gives the holder round-the-clock access to her credit card information. The holder is able to check her payment history, balances, and available credit. The user can also print out her accumulated account activity over selected time periods. y Bill Payment

Online credit cards make it much easier to make bill payments online. It helps the user pay bills on time and saves him expensive late payment fees. The user can charge his other bills to his online credit card, thereby only making one payment each month.

The other option includes making payments to your credit card company online. This option involves the additional step of setting up online payment arrangements through an online banking account. This allows the account holder to also pay his credit card company through direct payment from the bank. Considering the negative consequences of paying bills late--a reduced credit rating as well as high late fees--such convenience is a big advantage. y No Transaction Costs

Online credit cards for the most part carry no associated transaction charges or hidden costs. Lack of transaction costs makes it easier to maintain and manage online credit accounts. The online credit card holder not only saves money through the convenience of online payments, she also saves money from the cost of stamps and other postage charges required to mail bills or inquiries to the credit card company. However, some online credit card companies such as PayPal can charge the account holder small fees when a payment is made to her online credit card. Sometimes a small user fee is added to the cost of an online credit card transaction, but this is not a widespread practice.
c) Disadvantages

Very high interest rate

The high interest rate on the credit is one of the most important disadvantages of using credit cards. There are various reasons for the interest rates charged being huge in spite of the fact that you never noticed that they were high before purchasing the credit card. The first reason is that the credit card rates that are usually advertised are all monthly rates and when it is calculated for one whole year, it works out to be a huge amount. This is the reason why people are usually asked to clear all their credit card debts. Some people even advise to break your fixed deposits to pay off the credit card dues, as the interest is so high.


Credit card fraud is on the rise around the world. Smart cards need to be devised that can try to prevent credit card fraud. Many people have lost thousands when their credit cards were stolen and used to purchase various things. It may be easy to trace the purchase, but by the time the trace is done, the fraudster is long gone and the trail is cold. Skimming is another method by which the data on the card is read on a skimmer that is in turn used to commit fraud. y Buying beyond limit:

When you have purchasing power, you also need will power to prevent you from purchasing. If you have huge purchasing power, but low will power, then you will end up spending huge amounts. This can in turn cause your budget to be tossed aside. This is one of the reasons for many young people to be neck deep in debt. They purchase beyond their limits and then end up paying a lot of money as interest. y Internet fraud:

There are many utility and other payments that are done these days with the use of credit cards. The main disadvantage of this method of online payment by credit card is that unless the company is very good and has fail safe mechanisms, it is very easy for hackers to retrieve the information about your credit card and use them for their own benefit.




Another important disadvantage of credit card usage is that the last date for payment of dues and interests is very important. If one is unable to pay on or before the day, then a huge amount is charged that can lead the person further into debt. 2. a) Electronic Cash: Definition: (n): money that is exchanged electronically over computer or

telecommunications networks. - (n): any of various systems of payment for purchases made on the internet. b) Advantages: We can transfer funds, purchase stocks, and offer a variety of other services without having to handle physical cash or checks as long as bank is providing such services online. The significant effect is we do not have to queue in lines, thus saving our time.

Debit cards and online bill payments allow immediate transfer of funds from an individual's personal account to a business's account regardless the designated place (around the globe) by few clicks without any actual paper transfer of money. This bring convenience individual like us and businessmen.

Consumers will have greater privacy when shopping on the Internet using electronic money instead of ordinary credit cards. c) Disadvantages: E-cash and E-Cash transaction security are the major concern. Frauds on E-Cash are on the catch recent years. Hackers with good skill able to hack into bank accounts and illegally retrieve of banking records has led to a widespread invasion of privacy and has promoted identity theft. There are many other tricks including through phishing website of certain banks and emails.

Money flow and criminal/terrorist activities are harder to be traced by government. With the continued growth of E-Cash, money flow in and out of countries at immediate speed without being traced will weaken the government's ability to monitor and income in tax. Money laundering and tax evasion could be uncontrollable in e-cash systems as criminals use untraceable internet transaction to hide assets offshore.

E-Cash is not for everyone. Low income groups without computer and internet access are unable to enjoy the usage of E-Cash. This issue shall be resolved so that E-Cash could be implemented widely.

There is also a pressing issue regarding the technology involved in electronic cash such power failures, internet connection failure, loss of records and undependable software. These often cause a major setback in promoting the technology. III/ Discussion A/ Advantages of EPSs 1. EPS is very convenient for the consumer. In most cases, we only need to enter our account information (our credit card number and shipping address) once. The information is then stored in a database on the retailer's Web server. When we come back to the Website, we just log in with username and password. We complete a transaction simply with clicking your mouse: All we have to do is confirm purchase and we're done. EPS takes lower costs than businesses. They dont need spend too much on paper and postage. Offering EPS can also help businesses improve customer retention. With the benefits of EPS, it's no wonder that its use is on the rise. In order to better serve their customers, banks are swiftly moving to offer online bill pay services. (Grant Thornton's 2005 survey of bank executives found that 65% of community banks and 94% of large banks offer 24/7 online bill payment). Most of these services are free to

members. Alternatively, consumers can subscribe to online bill pay services (Pay trust or Yahoo! Bill Pay). These services charge a monthly fee in exchange for the convenience of paperless bill paying. 2. EPS can benefit our business by extending customer base; boosting cash flow; reducing costs; enhancing customer service and improving competitive advantage. Four reasons why EPS improve customer service: 1. Choice we can offer a wide range of payment options. 2. Convenience we remove the need for invoices, cheques and cash. 3. Credit we may allow purchases. 4. Concessions small discounts to encourage online purchases improve the perception of value. Some of the most important advantages are: Privacy - Integrity - Compatibility - Good transaction efficiency - Acceptability - Convenience - Mobility - Low financial risk Anonymity. Perhaps the greatest advantage of ESP is the convenience. Individuals can pay their bills and make purchases at unconventional locations 24h/day, 7days/week, 365days/ year in a flash. The cost of ESP is another benefit. For the majority of merchants, vendors, and businesses, there is no fee or charge to pay online. For others, the fee is nominal. (Compared to the cost of postage, check writing fees and trips to the post office, we can save a lot of money per year). In modern society, reducing expenses is quite important for many individuals. Besides that, EPS are secure. Encryption technology allows an individuals personal financial data to be scrambled before it is sent electronically. It also lowers the risk of human error by reducing the number of people touching the payment once it leaves the payer.