The previous sections described many different approaches to providing a system for secure payments to the Web. These systems can be divided into two groups based on their transaction style. Most systems perform transactions by issuing commands to make a credit card or bank account transaction. For example, First Virtual performs a credit card transaction after confirmation from the user. In contrast, DigiCash's ecash (and Digital's Millicent, discussed in the next section) use an electronic representation of cash that physically exists on the user's machine in electronic form. The two groups offer contrasting advantages and disadvantages.
By using an electronic representation of cash, true anonymous transactions are possible. This is more like physical cash, and provides many advantages to users concerned about some Orwellian 'Big Brother' knowing about their financial transactions.
A major problem with electronic representation of cash is the potential for double spending. If the issued coins are not kept track of efficiently, or they can be somehow duplicated, then the same coins could be spent twice with two different vendors. This problem adds to the complexity of electronic representation-based systems.
The use of encryption technology in these payment systems is a double-edged sword. Encryption provides security, but demands processing time. The processing required for each transaction determines the processing power necessary to run the system, and thus partially determines the cost to run the system. The cost to run the system is charged to users for each transaction made. If this transaction cost is significant, it prohibits the idea of microcent transactions discussed in the next chapter.
One final point is that the average consumer will not shop on the Web until a de facto standard emerges. This emergence could easily be brought about by a big name company (MasterCard, Microsoft, Netscape, etc.) coming forward and convincing the public that using their system is safe enough. Until this happens, the average user will continue to believe that putting their credit card on the Web in any way is essentially asking someone to steal it.
Copyright © 1996 Patrick N. Brooks
All Rights Reserved