Electronic Cash

Digicash: Ecash u “With ecash you can pay for access to a database, buy software ora newsletter by ,play a computer game over the net, receive $5 owed to you by a friend, or just order a pizza.”

Ecash Details u Must obtain ecash from an entity, which will give encrypted “coin” to individual to spend u Entity will agree to “cash” back the coin u Only customer has the serial number of the coin, but the bank has the key to the encrypted message u Anonymous, private (Mark Twain Bank)

NetBank: NetCash u Coupons of differing denomination are sent to purchaser with serial number u When spent at participating merchants, message sent to NetBank, that confirms coupon, and tells purchaser of such u No anonymity, no encryption u Dependant upon bank as intermediary

CyberCash: CyberCoin u “Consumer wallet” software u allows for micropayments u tied directly to an account at a bank u encrypted message transfers value by notational system, i.e. debit from consumer’s account and credit to merchant’s account u safety, less anonymity

Electronic Checks u Simple systems (most now) actually print and send physical check through regular banking system (example: Netchex, ABS Web Checks) u BankNet Electronic Banking Service offers “live” electronic checks, using encryption and digital signatures

Credit Cards u Theoretically need no particular system, could give out information as over the telephone u CyberCash offers free software tht uses encryption and imposes Cybercash as the intermediary in the transaction (possessing the key to decrypt the credit card info passed to the merchant)

Smartcards u Imprecise definition between smartcard and stored value card u Card which, by computer chip or magnetic tape, can transfer information which indicates right to payment u Used much more broadly in Europe than in U.S.

Mondex u Uses card reader hooked up to computer terminals u May be used either on or off line u Can accept up to 5 different currencies u Encryption and digital signatures

Applicable laws u Money: US Constitution does not allow states to mint money u Checks: Mostly by UCC Article 3 and 4; also Federal Regulations u Credit Cards: Private Agreements and Federal Truth in Lending Act u Electronic Payments: EFTA and Article 4A

Checks u Banks would suffer the loss for forgery, unless the customer’s negligence contributed to the loss