CHAPTER 10

Created by, David Zolzer, Reversed By ::Oldog Workshop::, Roger Lan

E-commerce Payment Systems

Learning Objectives(45 minutes)

Understand the features and functionality of the major types of digital payment systems in the B2C arena

Able to analyze current E-commerce websites’ payment systems

B2C Digital Payment Systems

Digital Wallets Digital Cash

Online Stored Value Systems Smart Card Stored Value Systems

Digital Credit Card Payment Systems Digital Checking Payment Systems

Digital Wallets

Definition: Authenticates the consumer through the use of digital certificates or other encryption methods, stores and transfers value, and secures the payment process from the consumer to the merchant

http://supermart.stockstar.com/supermarket/chinabank/aqzs.htm http://www.800buy.com.cn/hlp/hlp_payment_chinabank.htm

Promised Functionality of Digital WalletsPage 297, Table 6.2

Types of Digital WalletsPage 298, Figure 6.6

Case Study One: BOC E-wallet

Step 1: Download a E-Wallet program from website of Bank of China…

Step 2: Run the program on your computer and initiate the ID and password…

Step 3: Obtain a digital certificate for your E-Wallet from Bank of China…

Step 4: Restart your E-Wallet, and add your bank card into it…

Step 5: Verify your account and be ready to purchase…

Step 6: Online shopping and choose to pay via your E-Wallet…

Step 7: Confirm your order and enter your card password…

Step 8: Check the bill statement and feedback from your wallet and the website…

Case Study Two: Microsoft’s Passport Wallet Page 300, Figure 6.7

Digital Wallets

Client-based digital wallets are software applications that consumers install on their computer, and that offer consumer convenience by automatically filling out forms at online stores; merchants install software on their servers to receive information from the client-based wallet.

Server-based digital wallets are software-based authentication and payment services and products sold to financial institutions; no need to install any program; no need to download digital certificates; offers customers Single Sign-In service (SSI) and Express Purchase (EP).

Digital Credit Card Payment Systems

Seek to extend the functionality of existing credit cards for use as online shopping payment tools

How a Digital Credit Card Payment System WorksPage 310, Figure 6.10

Case Study Three: Credit Card Payment System of CMB

Digital Cash

Also called e-cash Digital forms of value storage or value

exchange that have limited convertibility into other forms of value and require intermediaries to convert

Examples of Digital CashPage 302, Table 6.3

Digicash: How First Generation Digital Cash WorkedPage 303,

Figure 6.8

Digital Cash

Online stored value payment systems permit consumers to make instant, online payments to merchants and other individuals based on value stored in an online account

Smart cards as store value systems are based on credit-card-sized plastic cards that have embedded chips that store personal information

Online Stored Value SystemsPage 305,

Table 6.4

How Ecount.com Works: A Stored Value SystemPage 305, Figure 6.9

Digital Credit Card Payment SystemsPage 309, Table 6.6

Digital Checking Payment Systems

Seek to extend the functionality of existing checking accounts for use as online shopping payment tools

Digital Checking Payment SystemsPage 312, Table 6.7

How Digital Checking Works: EcheckPage 313, Figure 6.11

Restart your E-Wallet

Add your Bank card ->

Obtain another certificate for your card account,which will verify your account balance and record…

Online shopping…

Choose the means of payment

Confirm your order…

Enter the password of your bank card

Transaction records in your wallet…

Confirmation from the website