WWW: Beyond the Basics

Chapter 8. Commerce

8.2 Secure Payment Systems

Widespread use of secure payment systems will be the next big step in the evolution of the World Wide Web. In this section, several approaches to Web payments are discussed.

The development of secure payment systems has lead to much discussion in the financial and regulatory arenas. By providing electronic financial services, are these system providers acting as a financial institution? If so, should they be subject to the same regulations as existing financial institutions? The Computer Law Association has published "The Internet and Business: A Lawyer's Guide to the Emerging Legal Issues"(Ruh), which addresses these issues.

The main Federal regulation that may apply to electronic commerce is the Electronic Fund Transfer Act (EFTA) and its implementing regulation called Regulation E. In chapter 8 of the aforementioned book, the author states "One of the most hotly debated questions arising from the possible applicability of Regulation E to electronic cash transactions relates to its requirement of delivery of a physical receipt, a requirement that would make electronic cash transactions unworkable." (Ruh).

Two approaches that provide secure electronic cash transactions are Secure Socket Layer (SSL) and Secure HTTP (SHTTP). SSL and SHTTP encrypt all Web network traffic, thereby allowing credit card numbers to be safely transmitted. Secure transactions are a byproduct of these systems, so they are not discussed with systems designed from the ground up to provide secure transactions. Chapter 18, Security, discusses SSL in more detail.

In the following sections, many different secure payment systems are discussed. To compare them, keep the following questions in mind:

[PREV][NEXT][UP][HOME][VT CS]

Copyright © 1996 Patrick N. Brooks
All Rights Reserved

Patrick N. Brooks <pbrooks@vt.edu>