Emergence of payment systems in the age of electronic commerce: The state of art

TLDR

E‑commerce has spurred demand for new financial solutions beyond traditional payment systems, prompting stakeholders to explore electronic payment methods—online credit cards, electronic cash, electronic cheques, and smart‑card‑based systems—each with distinct advantages and disadvantages. The study aims to classify electronic payment systems by the type of data transmitted over the network and evaluate their requirements, characteristics, and suitability. The authors assess electronic payment systems by examining key requirements—security, acceptability, convenience, cost, anonymity, control, and traceability—to compare their characteristics and determine applicability.

Abstract

The emergence of e-commerce has created new financial needs that in many cases cannot be effectively fulfilled by the traditional payment systems. Recognizing this, virtually all interested parties are exploring various types of electronic payment system and issues surrounding electronic payment system and digital currency. Broadly electronic payment systems can be classified into four categories: Online Credit Card Payment System, Online Electronic Cash System, Electronic Cheque System and Smart Cards based Electronic Payment System. Each payment system has its advantages and disadvantages for the customers and merchants. These payment systems have numbers of requirements: e.g. security, acceptability, convenience, cost, anonymity, control, and traceability. Therefore, instead of focusing on the technological specifications of various electronic payment systems, the researcher have distinguished electronic payment systems based on what is being transmitted over the network; and analyze the difference of each electronic payment system by evaluating their requirements, characteristics and assess the applicability of each system.