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Customers today often consider merchants more reliable that accept payment online through their site. It encourages
them to do business with the merchant. At the same time, online invoice payment offers consumer with the fraud
protection that secures their money if they don’t receive the product purchased online through a website.
5) Recurring Payments:
If you are offering some subscription-based services where your users/customers need to make payments after a certain
period of time, the option to receive online payment could be more suitable for you. Instead of sending them reminders
every time and requesting to send cheques for the payment, you can automatically collect payments after the end of the
subscription term.
Customers can use their credit cards to make payments, even though they don’t have money in their bank account. More
importantly, you can break down the payment into several installments, if you are selling expensive items. And one can
use credit cards to pay you in installments.
7) Affiliate Marketing:
If you have an online invoice payment system in place, you can create an affiliate program where your
affiliates can earn referral commissions by sending buyers to you. This will boost your sales and can find an
affiliate network, working to increase your revenue.
For a merchant, an option to receive online payment can improve reputation, allowing it to gain the trust of the
customers. Moreover, when others have online payment systems, you cannot afford to ask for payments via
cheques.
9) Influences buyers:
An online invoice payment method may influence customers to purchase items listed on the website. Since
the transaction is quick and easy, and one can pay via credit cards, buyers are more likely to grab the deal, if
there is an online payment system in place.
Many times, merchants throw cost-saving deals to lure customers. If you can receive online payment on your
site, a customer can grab a deal even at the last minute. This will increase sales.
CONS OF ONLINE TRANSACTION SERVICES
• At times, there occur millions and millions of requests at a time which gets difficult to handle.
• During purchases even if the servers hang for few seconds a large number of transactions get
affected, in turn affecting the organizations’ reputation.
• Databases store all user data and account information, if these servers are hacked, it could lead to
financial and personal problems (thefts).
• In the case of hardware failures of the online transaction processing systems, visitors of the
website get in trouble and their online transactions get affected.
• Electricity problem is another issue, i.e., if there is a shortage in electric supply additional backup
facilities like generators and related hardware, is a must.
• Online transaction processing involves a lot of staff working in groups to maintain inventory.
• These online transaction systems impose processing costs on the buyers and sellers as well.
• These systems do not have efficient methods of transferring products to buyers by themselves.
That’s where the e-commerce websites come in.
• The fundamental of operation of online transaction systems is atomicity. Atomicity ensures that if
any step fails in the process of the transaction, the entire transaction must fail, due to which the
same steps have to be repeated again and again while filling forms which causes dissatisfaction
among buyers.
FRAUDS WHILE ONLINE TRANSACTION
• Phishing: Any emails or websites that require personal or private information such as credit card, bank
account or login credentials are prone to phishing. If the source is trusted, such as a partner with a bank, the
website is trustworthy. However, if the source is unfamiliar, it could indicate an attempt at stealing
information.
• Identity theft: Identity theft exists outside of the digital realm as well, but it's a common type of fraud
online. A cybercriminal who steals personal information and uses it under false pretense is engaging in
identity theft. Hackers penetrate firewalls through old security systems or by hijacking login credentials via
public Wi-Fi.
• Pagejacking: Hackers can reroute traffic from your ecommerce site by hijacking part of it and directing
visitors to a different website. The unwanted site may contain potentially malicious material that hackers use
to infiltrate a network security system. Ecommerce business owners must be aware of any suspicious online
activity in this capacity.
• Advanced fee and wire transfer scams: Hackers target credit card users and ecommerce store owners by
asking for money in advance in return for a credit card or money at a later date.
• Merchant identity fraud: This method involves criminals setting up a merchant account on behalf of a
seemingly legitimate business and charging stolen credit cards. The hackers then vanish before the
cardholders discover the fraudulent payments and reverse the transactions. When this happens, the
payment facilitator is liable for the loss and any additional fees associated with credit card chargebacks.