1. Chapter 4 Getting Paid

2. Objectives Understand electronic payment systems Know why you need a merchant account Know how to get a merchant account Explain what transaction processors are Know what shopping cart software does

3. Payment Method Traditional Credit card Electronic payment

4. Stored Account Electronic Fund Transfer look-alike Funds are debited via a clearinghouse Easily traced transactions Complete record of your transactions – consumer profile developed Consumer privacy issues http://www.cybercash.com http://http://www.cybercash.com/fraudpatrol/

5. Stored Value E-cash Instantaneous transaction Can be used for small payments easier that stored accounts Less secure for the seller, more secure for the buyer Physical token acquired and value added to it Token kept on the system unit Breaches – physically or via protocol method http://ecash.com/online/

6. Obtaining a Merchant Account Open with the bank Similar to a loan application process Bank must trust you! Verify: Card Not Present or Mail Order Telephone Order Authonly Bank’s transaction process

7. Merchant Account Provides Verification of the credit card Process the transaction Deposit the result into your account

8. Merchant Account Costs Internet discount rate – 2-3% Transaction fee -.25 -.70 per transaction Monthly fees and minimums Holdbacks and charge backs Setup and equipment

9. Payment Processing Service Real time transactions Verifies the consumer’s transaction Sometimes tied to the shopping cart solution used Gateways – the bridge between the web site and the credit card processor Separate communications channel for the transaction

10. Shopping Cart Software Lists your products Let’s the consumer pick and choose their purchases Place choices in a virtual basket Check out and complete the order http://www.mercantec.com/main.html

11. Security SSL SET

12. SSL - Secure Socket Layer From the customer's computer to the business server Provide privacy and reliability Server and client authenticate to each other with cryptographic keys - 40 and 128 bit Client server sessions: Server authentication – digital certificate who I say I am Client authentication The customer is who they say they are Confidentiality No unauthorized entity

13. Secure Electronic Transactions Visa and MasterCard initiated Purposes: Keeps information confidential Authenticate the identity of the other party Via digital certificates Certificate Authority