This PPT includes the explanation on various types of Electronic payment systems used its working and the recent trends in E-commerce and Electronic payments with special reference to India, It also speaks of various security issues related with e commerce and the use of e-payment systems.

3. DEFINITION
Electronic Payment is a financial exchange that takes place online
between buyers and sellers.
The content of this exchange is usually some form of digital financial
instrument,
such as encrypted credit card numbers, electronic cheques or digital
cash,
that is backed by a bank or an intermediary, or by a legal tender.

4. TYPES OF EPS
E-CASH E-WALLETS
SMART CARDS CREDIT CARDS
ELECTRONIC
PAYMENT
SYSTEM

5. e-CASH
A system that allows a person to pay for
goods or service by transmitting a number
from one computer to another.
Like the serial numbers on real notes, e-
Cash numbers are also unique.
This is issued by a bank and represents the
real money.
It’s a Value Storage and exchange system
that operates online in much the same way
that government-issued currency operates
in the physical world.

6. e-CASH PROCESSING
1). Consumer buys e-Cash from bank.
2). Bank sends e-Cash bits to consumer.
( After charging that amount plus fee )
3). Consumer sends e-Cash to merchant.
4). Merchant checks with bank that e-Cash is valid.
( Check for forgery or fraud )
5). Bank verifies that e-Cash is valid.
6). Parties complete transaction.

7. The E-wallet is another
payment scheme that
operates like a carrier of
E-cash and other
information.
The aim is to give
shoppers a single, simple,
and secure way to
carrying currency
electronically.
Trust is the basis of the e-
wallet as a form of
electronic payment.

11. SMART CARDS
A smart card, chip card, or integrated circuit card (ICC) is
any pocket-sized card with embedded integrated circuits.
Smart cards are made of plastic.
Smart cards can provide identification, authentication, data
storage and application processing.
Smart cards may provide strong security authentication for
single sign-on (SSO) within large organizations

12. TYPES OF SMART CARDS
Contact smart cards have a contact area of
approximately 1 square centimeter (0.16 sq
in), comprising several gold-plated contact
pads.
These pads provide electrical connectivity
when inserted into a reader,
which is used as a communications medium
between the smart card and
a host (e.g., a computer, a point of sale
terminal) or a mobile telephone.
Cards do not contain
batteries; power is
supplied by the card
reader

13. 2. Contactless smart cards
TYPES OF SMART CARDS

14. 2. Contactlesssmart cards – Examples :
TYPES OF SMART CARDS

15. Smart cards are turning out to be a fundamental
piece of the transformation of retailing into
electronic commerce.
The impressive growth of the Internet is making
electronic shopping at least a real possibility, if not
a habit, among computer users.
SMART CARDS AND ELECTRONIC
PAYMENT SYSTEM

16. Credit cards or checks are simply too expensive to use for
micro-payments,
and the e-cash currently being experimented on the World
Wide Web does not seem to have the characteristics to
appeal to shoppers.
For this reason, smart cards could be a fundamental building
block of widespread use of electronic commerce,
since they are an instrument to pay at a low cost for
transactions involving small amounts of money.
SMART CARDS AND ELECTRONIC
PAYMENT SYSTEM

17. A smart card can contain a non-encrypted
profile of the bearer,
so that the user can get customized services
even without previous contacts with the
supplier.
SMART CARDS AND ELECTRONIC
PAYMENT SYSTEM
Smart cards are a key technology enabler
for financial institutions.
PC-based home banking and phone banking
will give way to card banking:
A phone equipped with a smart card reader
will be all that is needed for any kind of
transaction.

18. It is a Plastic card having Magnetic Number and Code
on it.
It has some fixed amount to spend.
Customer has to repay the spent amount after
sometimes.
CREDIT CARDS

19. Digital Credit Card Payment System extend the
functionality of existing credit cards for use as
online shopping payment tools.
Focuses specifically on making use of credit cards
safer and more convenient for online merchants
and customers.
Processed in much the same way that in store
purchases are.

21. One important challenge of e-commerce is Risk
Management.
The working of the payment systems incurs three
major risks;
i. mistake,
ii. privacy problems and
iii. credit risk.

22. I. Consumer Protection
• Virtually all electronic payment systems require some ability to keep
automatic records.
Once information has been electronically caught , it is easy and not
expensive to keep.
• The intangible nature of electronic
transactions and resolution of the
disputes relying alone on records,
a general law of payment
dynamics and banking technology
might be : No data should be
discarded.

23. Features of these automatic records are :
• Permanent storage
• Accessibility and traceability
• A payment system database and
• Data transfer to payment maker, bank or monetary authorities.
• The need of keeping of records for the purposes of risk
management conflicts with the transaction anonymity of cash.
An unknown payment system without automatic record keeping
facility will be difficult for bankers and government to accept.
However, customers might feel that all this record keeping is an
invasion of privacy.

24. II. Managing Information
Privacy
• The electronic payment system must
provide and maintain privacy.
Every time one purchases goods using a
credit card, subscribes to a magazine or
accesses a server that information goes
into a database somewhere.
This violates one the unspoken laws of
doing business; that the privacy of
customers should be protected as
possible.

25. • All details of a consumer’s payments can be easily
be aggregated : Where, when and sometimes what
the customer buys is stored.
This data collection tells much about the person
and as such can conflict with the individual’s
privacy.

26. • Privacy must be maintained against eavesdroppers on the
network and against unauthorized insiders.
The users must be given assurance that they cannot be
easily duped or falsely implicated in a fraudulent
transaction.
This protection has to be applied on the whole transaction
protocol.

27. III. Managing Credit Risk :
• Credit risk is an important concern in systems of net settlement because a bank’s
inability to settle its net position could give rise to a chain reaction of failures of
the banks.
The digital central bank must prepare policies to handle this possibility.
Various alternatives exist, each with advantages and disadvantages.
• A digital central bank guarantee on settlement issues eradicates the insolvency
test from the system because banks will more easily assume credit risks from
other banks,

28. Rs 500, Rs 1000 notes: Flipkart, Amazon want you to go cash less:
• E-commerce majors Amazon, Flipkart and Snapdeal have stopped
their CoD (cash-on-delivery) mode of payment following the Indian
government’s move to demonitise the Rs 500 and Rs 1,000 .
• While trying to make a CoD purchase on Amazon, you will be greeted
with a message saying :-
“We have disabled COD for you
to save cash for essential payments ”.

29. • Flipkart gives you a banner saying,
“This payment option is not available for this order”.
• The message advises people to use their debit/
credit cards or net banking to make purchases.

30. Paytm hits Record 5mn transactions a day:
• Following the ban on Rs 500 and Rs 1,000 notes, mobile
wallets, debit and credit cards, online money transfers have
seen a rise of 200%, industry experts have observed.
• Paytm, would be able to close the financial year with Rs
24,000 crore worth of transactions processed on the platform.

31. • The company registered a 700% increase in overall
traffic and 1,000% growth in the amount of money
added to the Paytm account over the past couple of
days.
• During this period, the transaction value continued to
be 200% of the average ticket size, while the number
of app downloads went up 300%.
• The number of transactions per user also went up
from 3 to 18 transactions in a week.

34. Digital transactions in banking sector going up: SBI
• Digital transactions have really gone up at my PoS transactions,
by300 per cent up in numbers,
• and 200 per cent by value.
• A lot of corporates were asking for Impress Cards for low value
payment to many of their contract workers, even for people like
drivers who were given cash to tank up cars.
• SBI is installing 3,600 PoS machines at various toll plazas so people
can use cards instead of cash at the tolls.
Arundhati Bhattacharya, chairperson , SBI.

35. Airtel Payments Bank goes live
with pilot project in Rajasthan
• Airtel Bank would commence the pilot
with banking points at 10,000 Airtel retail
outlets.
• The pilot is aimed at testing systems and
processes ahead of a pan-India launch.
• Customers in towns and villages in
Rajasthan would be able to open bank
accounts at Airtel retail outlets, which
would act as Airtel banking points and
offer a range of convenient banking
services.

36. • A wide network of merchants would accept digital payments
from Airtel Bank, offering customers the convenience of
cashless purchase of goods and services through their mobile
phones in a quick and secure manner
• The banking points would offer bank account opening services,
cash deposit and withdrawal facilities.
• Elaborating on the digital and paperless bank, the firm said,
account opening would be quick and paperless using Aadhaar
based e-KYC.
• It would allow money transfer to any bank account in India and
free money transfer from Airtel to Airtel numbers within the
Airtel Bank.

37. MobiKwik 'Lite' to make life easier for small business
holders
• MobiKwik, on Monday (28/11/2016), announced the
launch of MobiKwik 'Lite', an easy to understand and use
app that will help the unorgainised retailers and
shopkeepers across India in receiving payments seamlessly.
• The app will be available in all major Indian languages .

38. Some of the features of MobiKwik Lite include:
• Supports receiving payment.
• Bank transfer.
• P2P transfer.
• Bill payments and,
• Recharge.

41. A
Ayush G. K