Electronic Payment Systems

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Contents
Introduction2
History of the On-line Payment System2
Payment Service Providers3
Credit cards3
E-wallet3
Online Bill Payments4
Online Bank Transfers4
PayPal4
Benefits of using E-Payment:6
Customer confidence in Payment systems6
Reliable protection when using Payment Systems7
How do customers benefit?8
Drawbacks of On-line Payment Systems10
Card Holder Based On Biometrics:11
ONLINE BANKING SERVICES12
Disadvantages of Banking Services12
Small and Big companies in On-line Payment System13
RISK14
Theft:15
How can the On-line Payment Systems improve?17
Conclusion18
Bibliography:19


Introduction
On-line Payment System can be defined as the method used to pay for the purchases of goods and services over the internet. On-line shopping and on-line banking are both good examples of On-line payment Systems. Nowadays it is very important to have these services as they are convenient and people do not have to leave the comfort of their house to make purchases. It is now a necessity for companies to have On-line systems available to their competitors will gain advantage over them. It is also important that these companies have a secure online payment system for the security of their customers. History of the On-line Payment System

Online payment system has a very short history which only expands to about seventeen years and is still changing to this day. In 1991, Tim Berners-Lee created the World Wide Web and in 1994 “Stanford Federal Credit Union” was the first financial institution to offer online internet banking services to all of its members (http://en.wikipedia.org/wiki/Onlinebanking#History). The internet banking of Stanford Federal would have been the first online payment system to exist to customers. Also, in 1994, Pizza Hut set up the first online delivery system. By having the first online delivery system, Pizza Hut gained an advantage over its competitors. Being the first, Pizza Hut will always be one step ahead while other organisations in the same field try and get their version of the payment system up. In 1995 is where Commercialization of the internet began with the introduction of online shopping sites like Amazon.com. Once Amazon began to grow so did the importance of online payment systems. E-bay was the second business to follow the On-line Payment System. They seem to grow together with success as time went on. Now they are the two biggest online shopping sites on the web. The development of SSL (secure socket layer) encryption in 1995 by Netscape had made the internet a more secure place for online payments and this in turn brought the rise of online shopping. As the internet got more popular, so have online businesses and now its most defiantly part of everyday life. Even though the history of online payments is short, a lot has happened in that short period of time. Payment Service Providers

The first commercial online service known as E-commerce was introduced in 1979 by H&R Block and was considered the first major online service created to serve the market of personal computer users. Nowadays, people are more likely to have access the Internet 24/7 due to high-speed broadband facilities; therefore a new class of online service providers began to provide highly reliable access to the Internet to accommodate vast amounts of online buyers.

These online service providers’ perform by accepting electronic payment methods such as credit card and E-wallets, they also accommodate online bill payments and money transfers such as Western Union, bank transfers, and PayPal which all focus on making it simple for customers to purchase goods online or transfer money at any time via the Internet. Credit cards

Credit card is a plastic money card provider, which is controlled by worldwide bank companies to allow customers to make quick and convenient payments online on their favourite purchasing websites. The use of credit cards as a method of payment has had an...
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