| But credit cards have their limitations.
| |
| | such as those made in fast-food
|
| They are not suitable for purchases of
| |
| | restaurants, movie chains, convenience
|
| digital content costing less than a few
| |
| | stores, vending machines, payphones, and
|
| dollars per transaction (micro-payments).
| |
| | on mass transportation and toll highways.
|
| The card system is not cost efficient for
| |
| | A smart card payment scheme can manage
|
| processing small payment amounts, and in
| |
| | low-value and high-value payments. The
|
| many cases the minimum transaction amount
| |
| | low-value payment scheme is known as
|
| is around US$10.To sell digital content,
| |
| | e-purse, which is a cash-like, prepaid
|
| a different payment method is required.
| |
| | scheme, where the user has the choice of
|
| In the early days of the internet,
| |
| | making either personalized or anonymous
|
| developers created ?e-money,? enabling
| |
| | payments. Purchases can be made on the
|
| consumers to purchase low-cost items
| |
| | internet by a smart card reader that
|
| online from a website supported by the
| |
| | connects to a PC. Secure internet
|
| e-money provider. However, there was the
| |
| | payments may be made just as they are in
|
| potential for fraud on the part of the
| |
| | shops which use this device. The internet
|
| e-money providers, to whom consumers
| |
| | merchant uses a terminal which is similar
|
| supplied their credit-card numbers in
| |
| | to a normal shop merchant?s, and payment
|
| exchange for tokens.Many of these early
| |
| | and collection are made in the same
|
| attempts to create e-money mechanisms for
| |
| | way.An example of an intra-regional
|
| managing micro-payment transactions
| |
| | standard for cash is the NETS Singapore
|
| schemas met with business failure (e.g.,
| |
| | CashCard under the Visa Cash brand, which
|
| early micro-payment vendors such as
| |
| | has been implemented in Singapore,
|
| Flooz, Benz, Digicash). Even for feasible
| |
| | Philippines, and Korea, and recently in
|
| business cases, the failures often
| |
| | Thailand.Standards are required to
|
| occurred because the merchants had to
| |
| | develop nation-wide smart card?based
|
| implement additional hardware/software
| |
| | electronic purses that operate on a
|
| requirements, and the customers had to
| |
| | regional basis. Coupled with the
|
| prepay. It was simply too difficult to
| |
| | possibility of location-based services
|
| implement, and not worth the (then) small
| |
| | driven by the mobile telephone network,
|
| revenue streams from the internet. But
| |
| | the mobile telephone operator is well
|
| the situation is much different now. New
| |
| | positioned to market goods and services
|
| micro-payment services allow customers to
| |
| | to consumers on a one-to-one
|
| set up online accounts tied to their
| |
| | basis.ConclusionThere are a number of
|
| chequing and savings accounts, thereby
| |
| | challenges facing the retail banking
|
| reaching a whole new segment of customers
| |
| | sector today. The tradition of providing
|
| without credit cards. Micro-payment also
| |
| | a customer with account access via a
|
| has another future as a replacement for
| |
| | cheque or magnetic striped card is no
|
| cash to pay for goods and services at
| |
| | longer the way to attract or retain
|
| shops, cafes, bars, libraries, printers,
| |
| | ever-more-discerning consumers.
|
| pharmacies, sports centres, photocopying
| |
| | Escalating card fraud and new delivery
|
| and laser-printing shops, as well as for
| |
| | channels have changed the business
|
| bus and taxi fares, or for any purchase
| |
| | landscape forever.Micro-payments tied to
|
| in which coins are used.What are evolving
| |
| | a chip card could be a winner. The trends
|
| from the early attempts are three
| |
| | indicate that the most feasible
|
| distinct micro-payment schemas:- The
| |
| | solution?and the one increasingly
|
| Retail Model which utilizes a stored
| |
| | embraced worldwide?seems to be the smart
|
| value system
| |
| | card, a plastic card which stores all
|
| - The Telco Model which leverages the
| |
| | personal data in its embedded microchip
|
| telcos? billing system
| |
| | and which can be used for many functions,
|
| - The Financial Model which uses a
| |
| | thereby doing away with the need to stuff
|
| multi-application smart card with an
| |
| | wallets with many other single-function
|
| e-purseThe Retail Model - Stored Value
| |
| | plastic cards. Another factor is the
|
| SystemsThe principal of the stored value
| |
| | migration of credit and debit cards from
|
| systems is based on the micro-payments
| |
| | magnetic strip to EMV, which allows these
|
| schema: store value accounts are
| |
| | cards to be used seamlessly for
|
| connected to a credit card in which a
| |
| | micro-payments. The users have already
|
| consumer has to load credits in order to
| |
| | been educated. They know how to use
|
| make a purchases, or connected to a
| |
| | plastic cards, and using smart cards
|
| stored value account that accumulates
| |
| | would be the same, but common standards
|
| payments and makes authorizations based
| |
| | are important. The added advantage with a
|
| on increments.With a stored value system,
| |
| | chip card is that a loyalty feature can
|
| the consumers need to register for the
| |
| | be added to the chip, a natural extension
|
| services online or by phone; they have to
| |
| | which none of the other micro-payment
|
| provide a credit card number and load a
| |
| | methods can handle well.There are some
|
| balance. In order for the consumer to be
| |
| | issues associated with a smart card
|
| able to make re-loads, the system needs
| |
| | schema. For example, security needs to be
|
| to remember his or her information.
| |
| | foolproof: once a card has been breached,
|
| Stored value systems are common in the
| |
| | the cost of replacement is high. Security
|
| service industry, for example as part of
| |
| | costs money, and so smart cards tend to
|
| the McQuick service in Canada.Telco Model
| |
| | be more expensive than other methods.With
|
| - Micro-Payment BillingThe rapid
| |
| | the stored value system, the problem is
|
| penetration of GSM handsets has already
| |
| | user acceptance. Users have to manage
|
| led to a situation in which more
| |
| | their own accounts, and if there are many
|
| individuals carry a telephone than carry
| |
| | different service providers the user has
|
| a bankcard. Additionally, people tend to
| |
| | many accounts to manage. In order for a
|
| have a single mobile telephone from a
| |
| | real stored value system to work, the
|
| single operator, whereas they might have
| |
| | banks have to get behind it and adopt a
|
| multiple bankcards. This suggests that
| |
| | standard which merchants can sign up
|
| mobile operators have access to
| |
| | for.The success of the mobile operators
|
| demographic segments not available to
| |
| | will depend on the number of merchants or
|
| traditional financial institutions. By
| |
| | content providers who adopt the
|
| targeting the right demographic group,
| |
| | operators? billing systems. In order to
|
| mobile operators can use their own
| |
| | attract customers, merchants are offering
|
| billing systems to register micro-payment
| |
| | phone-customization features such as ring
|
| transactions. Pricing wireless
| |
| | tones, games, screen savers, and music.
|
| applications on a per-use or subscription
| |
| | It is a good market, but the real
|
| basis is the best way to appeal to
| |
| | adoption will happen only when merchants
|
| consumers and to give them value for
| |
| | can accept payments.The retail model will
|
| their money. More importantly, separating
| |
| | see minimum success. Large retailers
|
| content fees from transport fees allows
| |
| | might develop loyal customers who would
|
| carriers to keep all transport revenues
| |
| | use smart cards or a stored value system
|
| while enabling a revenue stream for
| |
| | offered by a financial services
|
| content providers. The Financial Model -
| |
| | organization.Over the next few years it
|
| Smart Card with E-PurseThe smart card
| |
| | will be interesting to see which
|
| uses chip card technology and is designed
| |
| | technology will demonstrate staying power
|
| for secure payments over the internet and
| |
| | and be adopted by consumers.
|
| mobile phones, and for micro-payments
| |
| |
|
