Chapter 6

carpentergambrinousSecurity

Dec 3, 2013 (4 years and 29 days ago)

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BUS 361: E
-
Business

Chapter
6

Billing

&

Payment Systems

Objectives


Describe the characteristics of payment systems
used online


Describe how billing & payment techniques relate
to corporate strategy


ID and describe emerging electronic billing &
payment systems


Describe +/
-

of above


Evaluate Suitability of methods for various e
-
bus
scenarios


The future



Why do we care?


Security


Ease of payment


B2B vs. B2C


Credit card issues (B2C)


Endless evolution … now PayPal


Bitcoins


What do “we” care about??

Traditional Payment Systems

1.
EDI


B2B used to use Value
-
added Networks


Privately owned network that is rented to users
who then use them to connect with customers &
suppliers


Replaced by Internet


Linking corporate bank accounts


Traditional Payment Systems (2)

2.
Cash


Portability


Acceptance


Prepaid money cards


Digital currencies created by companies


E
-
gold,
webmoney


Claimed to be backed by gold (old gold standard)


Anonymity


Instant transfer of value

Traditional Payment Systems (3)

3.
Digital Cash


Early attempt
Ecash


Went bankrupt


Used public/private key encryption


Proves that she sent the message


pp 117
-
118

4.
Digital Cheques


Would they be honoured


vanished

Traditional Payment Systems (4)

5.
Credit Cards


Used to be net was used primarily for research


Then credit cards accepted


Personal profiles (+ from both perspectives)


HTTPS to send info


Online fraud 3* traditional (.14%)





Credit Card Fraud
-

(American Express Canada, MasterCard Canada, Visa Canada)







2011


2012


2011

2012

2011

2012







Loss



No. of Accounts

Average Loss per Acc.


Lost



$10,757,451 $8,663,910

22,852

17,899

$470.74

$484.04

Stolen


$21,692,185 $18,322,777

34,336

34,408

$631.76

$532.52

Non Receipt




$4,736,900 $3,628,009

2,300

1,793

$2,059.52

$2,023.43

Fraudulent

Applications





$6,075,704 $8,522,715

2,465

3,693

$2,464.79

$2,307.80

Counterfeit Domestic




$88,356,720 $68,652,172

119,522

102,371

$739.25

$670.62

Counterfeit Cross Border




$31,809,823 $49,457,366

34,839

56,250

$913.05

$879.24

Card Not Present (Fraudulent e
-
commerce, telephone and mail purchases)





$259,498,535 $268,573,473

402,755

529,989

$644.31

$506.75

Account takeovers & Other




$13,661,440 $13,543,195

5,108

5,938

$2,674.52

$2,280.77

Total: Credit Card Fraud





$436,588,757 $439,363,617

624,177

752,341

$699.46

$584.00

Credit Cards

To ensure validity:


May only ship to address of card holder


PIN

Moneris
:


Jointly funded by BMO & RBC (Dec. 2000)


350,000 businesses in Canada alone


M/C,
Interac
, Visa, Amex, Discover


Countertop, short range wireless, long range
wireless, Mobile app & reader,
Contactless


$525 set up, $52 monthly, $.25 + 3% per
transaction


More importantly ..

Moneris

offers online payment solutions e.g. …


Hosted pay pages


Shopping cart integration


Recurring payments


Vault token technology


Online fraud tools


Interac

online


Traditional Payment Systems (5)

6.
Debit Cards


Reloadable

cards (Starbucks, Tim’s, phone cards)


Still fraud issues

7.
Smart Cards


Mondex

& Visa Cash


Contains a microchip


Stores info on transactions & balance


Load @ bank or
Mondex

ATM


Use in person or online


Test marketed and coming soon


Contact and
contactless

PayPal


Owned by eBay


290 million accounts worldwide


$60 Billion in 2008


Recipient can be PayPal member or not


Businesses pay per transaction


Cheaper than credit card (
iTunes

example)


Thinks of all the info they have about all those
people … +/
-

Payoneer


Around since about 2007


Prepaid debit cards


Global bank transfers


Local
eWallets


International checks



Paypass


Mastercard


Speedpass

… key fob


Electronic
bill payments