What are the arguments in favour of electoral reform in britain Essay

What are the arguments in favour of electoral reform in britain - Essay Example While people have greater disregard for politicians, many are looking at them with mistrust, as they feel that politicians have no solutions fro the ills that face the country. As, the country needs more aggressive approach towards politics and the requirement to bring the required changes in political culture and conduct of politics, the methods to do so should include expansion of citizenship and voter education programs. However, the greatest need is to change the voting system, without which the above-mentioned goals may not be achieved. Hence, this paper shall discuss on the merits of the desired changes, which are called as electoral reform for Great Britain. In this direction, the effective application of advantages of â€Å"Single Transferable Vote† (STV), would require massive interaction with the politicians and citizens, encouraging younger blood to participate in elections, analyzing electoral results and reporting of election news by media in a mature and responsible manner.....(Electoral Reform Society, 2009) While the liberal parties have always favored a change in the voting system, conservative parties like the labor party and its allies are happy with the present system of voting. However, the adoption of Proportional Representative method of voting would necessarily change the present system of FPTP. As this system is prevalent in UK and USA, we find number of countries in the continent that follow a liberal proportional representative (PR) system of voting. The present system of FPTP allows for demarcation of constituencies, according to their geographical location and demographic characteristics, while the electorate is divided into such constituencies allowing a candidate to contest polls from a particular territory. Under this system, there is no difference in the winning methodology as any candidate is winner, whether he or she

Contamination and Remediation Essay Example | Topics and Well Written Essays - 2500 words - 1

Contamination and Remediation - Essay Example These properties have been passed over to the government for redevelopment. (source) One of these areas is 500 acres of land which used to be a petroleum refinery area. The former owner of the property, the Amoco Oil, together with the Sugar Creek Township would like to apply to the government for remediation of this property. They would like to redevelop this property and turn the 300 acres into a commercial and industrial site. They believe that the development of this property would bring back the value of the property, create job employment, and bring progress to the community. (source) Amoco oil has occupied 500 acres of land on both sides of Sugar Creek. The Missouri River bounds the site to the north, wooded areas are on the East Buff and West Bluff, and residential areas are t the south.(in ASTRA) The Norledge area is adjacent south side of the site. The Alchion Topeka & Santa Fe and the Missouri Pacific railroad lines run through the northern portion of the site. The state and the government provide financial assistance to qualified Brownfield developers as part of the Brownfield Assistance Program. Since Sugar Creek is a partner in this venture, municipal obligation bonds may be issued on a long term maturity to provide sufficient time for development. Amoco on its part of the deal may use corporate borrowings in forms of debt and or equity from shareholders a. Technical viewpoint. The technical side of the remediation is the identification or eligibility of participation of the proponents in the Brown field Cleanup program. A technical assessment will be done by the US EPA if the area qualifies to be in the Brownfield program (Dept. of Conservation) b. Remediation process. Clean up can make use of several process but use of pumps was found appropriate for Amoco’s purpose Initial efforts used a trench-type recovery system

Evaluate two articles on voter turn out. Articles will be uploaded Essay

Evaluate two articles on voter turn out. Articles will be uploaded - Essay Example s has been decreasing as well such that in the mid sixties 2.4 out of every 1,000 women over the age of 20 belonged to the League of Women Voters while this ratio decreased to 0.79 per 1,000 in 1988 (p. 653). Overall, this indicates that interest in the political process is decreasing with decreasing voter turnout since the sixties being a symptom of this phenomenon. The study in question attempts to gauge the effects of personal canvassing, telephone calls and direct mail on voter turnout while improving on gaps in previous research on the issue. It has been indicated that previous research on the issue is not credible because the sample sizes used were too small to provide strong generalizations. Previous research had sample sizes of between 200 and 500 respondents resulting in confidence levels of 95% with a variation of twenty percentage points (p. 654). In contrast, the current research has a sample size that is at least 100 times as large as previous research and excludes students because they are used for personal canvassing in this research (p. 655). The study is based on three types of intervention namely personal canvassing, telephone calls and direct mail that the researchers have labeled as treatments. The total size of the sample size was some 29,380 people selected at random from various neighborhoods around the city. The control groups were not provided any treatment at all while certain groups were provided one or more treatments (p. 655). Certain people demarcated for treatment who could not be reached (such as through phone calls) were shifted over into the control group because they met the criteria of the control group better than that of treatment. This shift of data tends to give this study a more realistic picture of intervention because previous studies have largely failed to accommodate such changes (p. 654). However, in assigning certain groups more than one treatment the research has moved into multivariate analysis that could not be

Groups and Culture Essay Example for Free

Groups and Culture Essay Cultural and social expectations dictate that individuals as members of one culture or society interact with other members, it is in the interpersonal relationships and interactions that the individual has with others that socialization occurs (Hofstede, 2000). The first interpersonal relation that an individual in any culture would have is confined in the family. Growth and maturation however dictates that the individual relate and interact with other people outside of his or her family, this could be teachers, caregivers, classmates and friends. Interacting with other people widens the perspective of the individual, in play children learn how to communicate and compromise, in the classroom, they learn to compete and cooperate and in the workplace, they learn to conform and collaborate (Hofstede, 2000). Everyone is part of a group, be it the family, a neighborhood, a class, a department, or a community. A fully functioning and healthy individual would be a member of two or more groups, and for each group, a different set of rules and expectations apply. A universal characteristic of groups is that it consists of two or more individuals who are interacting and behaving towards a common goal. Within this setting, group members constantly communicate, cooperate, and conform to the rules and objectives of the group (Guss, 2002). For example, a gang of adolescent boys had been formed based on friendship, and each member subscribes to the rules of the gang, thus behaviors like rites of initiation are meant to strengthen the member’s commitment to the group. The goal of the gang may simply be to cultivate their friendship and protect each other, thus the members would cooperate in order to achieve that goal (Brew, Hesketh Taylor, 2001). In contrast, a group of teenagers in a bus is not really a group because they do not have shared rules and expectations, although they may have the same goal, and that is to reach their destination. Groups also tend to form and break up over the course of life events and human development. The behavior of groups and its members are also heavily influenced by the dominant culture in which it is situated. A group of workers in a collectivist culture like that of South Korea would strongly conform to the rules and regulations of the organization they work for (Hofstede, 2000). Complaints against company practices or policies are expected to be minimal such that collectivist cultures places value on group cohesion, unity, and cooperation. Workers in South Korea would believe that they are working not for themselves but for their families, their organization and their country. Thinking of one’s self above others in this culture is frowned upon, thus, not many individuals take leadership roles because it calls attention to oneself (Hofstede, 2000). Thus, workers conform without question, they cooperate with the given policies and they build relationships among the workers. On the other hand, a group of workers in an individualist culture like the US is not as easily conforming and cooperative as the workers in South Korea. Individualist cultures places importance on individual achievement, individual differences, self-expression and nonconformity (Hofstede, 2000). Workers in the US would join organizations that provide them with the opportunities for individual achievement and professional growth. To a certain degree, US workers do conform to the expected behavior of workers, but only if they perceive it as a necessary requirement of their individual performance. For example, workers generally attend company activities because they get something out of it, or because it is required of them to come and attendance would have positive implications in one’s performance rating (Hofstede, 2000). In this culture, workers are vocal about their ideas and opinions about the organization’s policies, they are confrontational such that demanding increase in one’s salary is the norm, not the exception. References Brew, F. P. , Hesketh, B. , Taylor, A. (2001). Individualistic-collectivist differences in adolescent decision making and decision styles with Chinese and Anglos. International Journal of Intercultural Relations, 25, 1-19. Guss, C. D. (2002). Decision making in individualistic and collectivistic cultures. In W. J. Lonner, D. L. Dinnel, S. A. Hayes, D. N. Sattler (Eds. ), Online Readings in Psychology and Culture (Unit 4, Chapter 3), (http://www. wwu. edu/~culture), Center for Cross-Cultural Research, Western Washington University, Bellingham, Washington USA. Hofstede, G. (2000). Cultures consequences: Comparing values, behaviors, institutions, and organizations across nations (2nd ed. ). Thousand Oaks, CA: Sage.

Lost Horizon :: essays research papers

Hilton, James. Lost Horizon. New York:   Ã‚  Ã‚  Ã‚  Ã‚  William Morrow and Company,1939.   Ã‚  Ã‚  Ã‚  Ã‚     Ã‚  Ã‚  Ã‚  Ã‚  I read Lost Horizon for my book report. The main characters in this story are Conway, Mallinson, Barnard, and Miss Brinklow. Conway was a man of thirty-seven years old who didn’t have a wife or any other family. Mallinson was a young man of about twenty or so who was not married yet either. Barnard was a middle-aged man that was without a wife or family also. Miss Brinklow was a woman of around the age of fifty.   Ã‚  Ã‚  Ã‚  Ã‚  This story was about four passengers on an aeroplane that was supposed to be going to Peshawar from Baskul. While they were on the trip, they noticed that the pilot wasn’t keeping a straight course to Peshawar, so they went to the front to ask the pilot what was happening and they noticed that it wasn’t the pilot who was supposed to be flying the aeroplane. When they tried to ask the pilot what was going on, he pointed a gun on them, so all they could do was ride the plane until he stopped.   Ã‚  Ã‚  Ã‚  Ã‚  They finally came to a land after they had flown many hours. The pilot was dying and in his last words he told them that there was a place not far from where they were and that they could go there. Not long on their journey they met some people who were from this place, which is called Shangri-La, and these people led them there. When they got there, they were told that it would be about two months before there was a way for them to make the journey back to civilization.   Ã‚  Ã‚  Ã‚  Ã‚  In these two months Conway and Chang, who was a guy that made their stay comfortable, talked a lot. In these talks Conway would ask many questions that Chang could not answer and this got Conway puzzled and made him think that there was something that was being hidden.   Ã‚  Ã‚  Ã‚  Ã‚  Almost after these two months were up Chang told Conway that the High Lama wanted to see him and that this was an honor because he had never seen anyone that quickly after arriving there. When Conway was talking with the High Lama, he told him the story of the place and about the person who founded it. He also told him about the legend that this guy had never died and that when someone came to this place that there was a drug that they took that made them live longer than a normal person would.

The Picture Of Dorian Gray Essay -- essays research papers

Art, what is Art? It is an ambiguous matter: without an exact form, an exact meaning. Does it have any rules or restrictions? However, it can be a great influence on the lives of people. In the novel, The Picture of Dorian Gray, two lovers have fell in and out of love due to Art!   Ã‚  Ã‚  Ã‚  Ã‚  Dorian Gray found Sibyl charming because of her Art!  ¡Ã‚ §She has not merely art, consummate art-instinct in her, but she has personality also; and you have often told me that it is personalities, not principles, that move the age ¡Ã‚ ¨ (63). Sibyl is an actress. She is formed by others: no self is without external influence. Therefore, Art that expresses the self is less valuable than art which expresses the influence of others. The special thing that made Dorian mad about her is that she is more than an individual.  ¡Ã‚ §I (Dorian) have seen her in every age and in every costume. Ordinary women never appeal to one ¡Ã‚ ¦s imagination. No glamour ever transfigures them ¡Ã‚ ¨ (59). By imagination that Sibyl has the power to arouse, she can be of any characteristics. Art has no set form, but the purpose of art is to give form to feeling. Now, Sibyl is a person that is able to provide all kinds of feelings that Dorian wishes to experience. Dorian finds extreme pleasure in experiencing through all the sentiments that Sibyl gives. Being a spectator to the different lives and stories amuses Dorian: one evening Sibyl is Juliet, next evening she is Imogen, another night, she is Roselind. &nbs... The Picture Of Dorian Gray Essay -- essays research papers Art, what is Art? It is an ambiguous matter: without an exact form, an exact meaning. Does it have any rules or restrictions? However, it can be a great influence on the lives of people. In the novel, The Picture of Dorian Gray, two lovers have fell in and out of love due to Art!   Ã‚  Ã‚  Ã‚  Ã‚  Dorian Gray found Sibyl charming because of her Art!  ¡Ã‚ §She has not merely art, consummate art-instinct in her, but she has personality also; and you have often told me that it is personalities, not principles, that move the age ¡Ã‚ ¨ (63). Sibyl is an actress. She is formed by others: no self is without external influence. Therefore, Art that expresses the self is less valuable than art which expresses the influence of others. The special thing that made Dorian mad about her is that she is more than an individual.  ¡Ã‚ §I (Dorian) have seen her in every age and in every costume. Ordinary women never appeal to one ¡Ã‚ ¦s imagination. No glamour ever transfigures them ¡Ã‚ ¨ (59). By imagination that Sibyl has the power to arouse, she can be of any characteristics. Art has no set form, but the purpose of art is to give form to feeling. Now, Sibyl is a person that is able to provide all kinds of feelings that Dorian wishes to experience. Dorian finds extreme pleasure in experiencing through all the sentiments that Sibyl gives. Being a spectator to the different lives and stories amuses Dorian: one evening Sibyl is Juliet, next evening she is Imogen, another night, she is Roselind. &nbs...

Electronic Payment System

UNIT – 3 Electronic Payment System Contents †¢ What is E-payment? †¢ Types of E-payment Systems †¢ Digital Token-based Electronic Payment Systems †¢ Smart Cards & Electronic Payment Systems †¢ Credit Card-based Electronic Payment Systems †¢ Risk & Electronic Payment Systems †¢ Designing Electronic Payment System What is E-payment ? †¢ E-payment systems is the mechanism of transferring money over the Internet and technology used in this transfer is called as EFT. EFT defined as â€Å" any transfer of fund initiated through an e-terminal, telephonic instrument, or computer or magnetic tape to order, instruct or authorize a financial institution to debit or credit an account. It is mostly used for Business to business (B2B) commerce where companies doing business together tend to use electronic data interchange (EDI) system to send each other bills and notices of payment. E-Payment †¢ Information online offline $Products/services Adva ntages of E-Payment †¢ †¢ †¢ Increase payment efficiency – Reduce transaction costs – Enable trade in goods and services of very low value Increase convenience of making payments – Payment can be made swiftly and remotely using various devices Can be used for – e-commerce / e-Trade – For other purposes like paying bills, taxes, etc MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 1Categories of EFT Banking and financial payments * Large-scale or wholesale payment * Small scale or retail payment * Home banking Retailing payments * Credit cards * Debit cards On-line electronic commerce payments * Token-based payment system ~ Electronic cash ~ Electronic checks ~ Smart cards or debit cards * Credit card-based payment systems ~ Encrypted credit cards ~ Third-party authorization numbers Main factors when selecting e-payment method †¢ Availability (bank system, laws and regulations) †¢ The consideration of size and type of business, type of a target group of consumers, types of products and services. The ability to provide security against fraudulent activity †¢ Being cost effective for low value transaction fees †¢ Being protective of the privacy of the users †¢ Easy to use, and being convenient for purchasing on the web based e-business Token-based E-Payment Systems Electronic tokens are the new financial instruments which are in the form of electronic cash/money or checks.Electronic tokens are same as cash that is backed by bank. They are of three types: 1. Cash or real-time ( e-cash) 2. Debit or Prepaid (smart cards, e-purses) 3. Credit or Postpaid (credit/debit cards, e-checks) E-cash Electronic cash is a consumer-oriented electronic payment. Though it replaces the cash but still cash is quite dominant form of payment for three reasons: 1. Lack of trust in banking system 2.Inefficient clearing and settlement of non-cash transaction 3. Negativ e real interest rates paid on bank deposit Advantages of cash over credit cards †¢ It is negotiable †¢ Cash is a legal tender †¢ Cash is a bearer instrument †¢ It need require bank account to operate †¢ No risk on the part of acceptor that the medium of exchange may not be good MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 2Properties of e-cash E-cash must have following four properties: Monetary values: Interoperability Retrievability Security E-cash in Action †¢ E-cash based on cryptographic systems called â€Å"digital signature† †¢ †¢ †¢ This method involves pair of two numeric keys (very large number or integer) that work in tandem (cycle): one for encoding and another for decoding. Message encoded with one numeric key can only be decoded with other numeric key and none other. The encoding key is kept private while the decoding key is made public. E-checks †¢ E-checks are a nother form of electronic tokens. †¢ †¢ A new electronic version of paper check. E-check is an instruction to a financial institution to pay a given amount of money to the payee. It is a specially formatted email message sent over the Internet. It contains as the same information as on paper based check. Check service providers PayByCheck (http://www. paybycheck. com) CyberSource (http://cybersource. com) Transaction Payment Sequence in E-check system Payer Transfer e-check Payee Deposit e-check Forward e-check for payer authentication Bank Accounting Server MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof.Vanita Joshi, SOM, SIMS, Indore 3 Transaction Payment Sequence in E-check system †¢ Buyer must register with third party account server using electronic check. †¢ On receiving the check, the seller presents it to accounting server for verification and payment. †¢ The accounting system verifies the digital signature on the check. †¢ Proper ly signed and endorsed checks can be electronically exchanged between financial institutions through electronic clearing house. Advantages of E-Check †¢ They work in the same way as traditional checks. †¢ E-checks are suited for micro payments. Eliminate the need for expensive process reengineering and taking advantage of the banking industry. †¢ Financial risk is assumed by accounting server. †¢ E-checks create a float through third-party accounting server. They make money out of buyers and sellers transaction by providing deposit account. Difference b/w EFT and E-check †¢ In E-Cheque, electronic versions of the cheque are issued, received & processed. So, payee issues an E-Cheque for each payment. †¢ In EFT transfer automatic withdrawals are made for monthly bills or other fixed payments; no cheques are issued.Smart cards †¢ A smart card is a plastic card with an embedded microchip containing information about you. †¢ A smart card can store about 100 times the amount of information that a magnetic strip plastic card can store. †¢ A smart card contains private user information, such as financial facts, private encryption keys, account information, credit card numbers, health insurance information, etc. †¢ So far not successful in U. S. , but popular in Europe, Germany, Singapore and Japan to pay for public phone call, transportation.Mondex Smart Card †¢ Holds and dispenses electronic cash (Smart-card based, stored-value card) †¢ Developed by MasterCard International †¢ Requires specific card reader, called Mondex terminal, for merchant or customer to use card over Internet †¢ Supports micropayments and works both online and off-line at stores or over the telephone †¢ Secret chip-to-chip transfer protocol †¢ Loaded through ATM – ATM does not know transfer protocol; connects with secure device at bank MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi , SOM, SIMS, Indore Mondex Smart Card Processing Mondex Smart Card †¢ Disadvantages – Card carries real cash in electronic form, creating the possibility of theft – No deferred (overdue) payment as with credit cards – cash is dispensed immediately Types of Smart cards Smart cards are basically of two types: 1. Relationship-based Smart Cards 2. Electronic Purses and Debit Cards Relationship-based Smart Cards It is the enhancement of existing card services that offer customers far better options like: 1. Access to multiple accounts (debit, credit, e-cash) on one card. 2.Offer various functions ( cash access, bill payment, balance inquiry, fund transfer) 3. Multiple access options at multiple location using multiple access device (ATM, PC, PDA or screenphone etc) Electronic Purses and Debit Cards Electronic Purses or E- wallet are the smart cards embedded with programmable microchip that store sum of money instead of cash. Once a purse is loaded with money it require card reader vending machine which verifies its authenticity . Then after amount is deducted from balance. It shows the remaining balance on the card hence eliminate the small bill in busy stores.E-wallets when depleted can be recharged with money . MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 5 Credit cards-based e-payment system Credit Cards †¢ A credit card is a small plastic card issued to users dealing in e-commerce. Most credit cards are the same shape and size, as specified by the ISO 7810 standard. †¢ A credit card is different to a debit card in that it does not remove money from the user's account after every transaction. In the case of credit cards, the issuer lends money to the consumer (or the user) to be paid to the merchant.Credit cards-based e-payment system Customers who purchase any goods send their credit card details to the service provider involved and the credit card organization will handle thi s payment. Online credit card payment has following categories: 1. Payment using plain credit card details 2. Payments using encrypted credit card details 3. Payment using third-party verification Entities involved in Credit card Transaction Consumer (Buyer or Card holder) Merchant (Seller) Card Issuer (Consumers’ Bank) Acquirer or Principal (Merchant’s Bank) Card Association (Visa, Master Card etc) Third party processor How an Online Credit Transaction WorksEncryption and Credit cards Encryption process starts when credit card information is entered into a browser and sent securely over network between buyer to seller. Encryption process includes following steps: 1. Customer presents his credit card information securely to merchant. 2. Merchant validates the authenticity of card holder 3. Merchant relays this information to its bank or on-line card processor. MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 6 4. The bank r elays the information to customer’s bank for authorization approval 5.The customer’s bank returns the credit card , charge authentication and authorization to the merchant Processing Payment with Encrypted Third-party authorization and Credit cards In third party processing, consumer register with third party on the internet to verify emicrotransaction. The companies providing third party payment service on internet are: ( First Virtual) †¢ http://www. fv. com †¢ http://www. openmarket. com †¢ http://www. 2checkout. com/ †¢ http://www. paypal. com/ Payment can be made by credit card via clearing house.Online Third-Party Processor (OTPPs) has following steps for buying information online. 1. Consumer registers for an OTPP a/c that is backed by credit card. 2. To purchase customer request merchant by her OTPP account no. 3. Merchant then contact the OTPP payment server with customer’s account no. 4. OTPP payment server verifies the customerâ₠¬â„¢s account no. for vender (merchant) & checks for sufficient funds. 5. OTPP server send a message to buyer that can be responded back by buyer as ; yes/agree; No/disagree; fraud. 6.If OTPP gets ‘Yes’ from customer, merchant is informed & then customer is allowed to download material. MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 7 Online Payment Processing using a Third-party Processor Risk in using Credit cards †¢ Customer uses a stolen card or account number to fraudulently purchase goods or service online. †¢ Many people who will be on the Internet have not even had their first Web experience. †¢ Hackers find the ways into an e-commerce merchant’s payment processing system and then issue credits to hacker card account numbers. Many users are also likely to be younger and have less access to credit and debit cards †¢ Many purchases they make will be micropayments. †¢ Credit cards canno t be used for large sums of B2B transactions †¢ Customer falsely claims that he or she did not receive a shipment Limitations of Online Credit Card Payment Systems †¢ Security – neither merchant nor consumer can be fully authenticated. †¢ Cost – for merchants, around 3. 5% of purchase price plus transaction fee of 2030 cents per transaction. †¢ People living in rural areas don’t have same access to computers and Internet that others do. Social equity – many people do not have access to credit cards (young and old age), disabled, individuals who are not computer savvy and individuals who cannot afford cards ( poor credit risk). Designing Electronic Payment Systems Following criteria should be satisfied while designing any new E-payment System: 1. Privacy 6. Pricing 2. Security 7. Standards 3. Intuitive Interface 4. Database Integration 5. Brokers MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Ind ore 8 Electronic Payment System UNIT – 3 Electronic Payment System Contents †¢ What is E-payment? †¢ Types of E-payment Systems †¢ Digital Token-based Electronic Payment Systems †¢ Smart Cards & Electronic Payment Systems †¢ Credit Card-based Electronic Payment Systems †¢ Risk & Electronic Payment Systems †¢ Designing Electronic Payment System What is E-payment ? †¢ E-payment systems is the mechanism of transferring money over the Internet and technology used in this transfer is called as EFT. EFT defined as â€Å" any transfer of fund initiated through an e-terminal, telephonic instrument, or computer or magnetic tape to order, instruct or authorize a financial institution to debit or credit an account. It is mostly used for Business to business (B2B) commerce where companies doing business together tend to use electronic data interchange (EDI) system to send each other bills and notices of payment. E-Payment †¢ Information online offline $Products/services Adva ntages of E-Payment †¢ †¢ †¢ Increase payment efficiency – Reduce transaction costs – Enable trade in goods and services of very low value Increase convenience of making payments – Payment can be made swiftly and remotely using various devices Can be used for – e-commerce / e-Trade – For other purposes like paying bills, taxes, etc MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 1Categories of EFT Banking and financial payments * Large-scale or wholesale payment * Small scale or retail payment * Home banking Retailing payments * Credit cards * Debit cards On-line electronic commerce payments * Token-based payment system ~ Electronic cash ~ Electronic checks ~ Smart cards or debit cards * Credit card-based payment systems ~ Encrypted credit cards ~ Third-party authorization numbers Main factors when selecting e-payment method †¢ Availability (bank system, laws and regulations) †¢ The consideration of size and type of business, type of a target group of consumers, types of products and services. The ability to provide security against fraudulent activity †¢ Being cost effective for low value transaction fees †¢ Being protective of the privacy of the users †¢ Easy to use, and being convenient for purchasing on the web based e-business Token-based E-Payment Systems Electronic tokens are the new financial instruments which are in the form of electronic cash/money or checks.Electronic tokens are same as cash that is backed by bank. They are of three types: 1. Cash or real-time ( e-cash) 2. Debit or Prepaid (smart cards, e-purses) 3. Credit or Postpaid (credit/debit cards, e-checks) E-cash Electronic cash is a consumer-oriented electronic payment. Though it replaces the cash but still cash is quite dominant form of payment for three reasons: 1. Lack of trust in banking system 2.Inefficient clearing and settlement of non-cash transaction 3. Negativ e real interest rates paid on bank deposit Advantages of cash over credit cards †¢ It is negotiable †¢ Cash is a legal tender †¢ Cash is a bearer instrument †¢ It need require bank account to operate †¢ No risk on the part of acceptor that the medium of exchange may not be good MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 2Properties of e-cash E-cash must have following four properties: Monetary values: Interoperability Retrievability Security E-cash in Action †¢ E-cash based on cryptographic systems called â€Å"digital signature† †¢ †¢ †¢ This method involves pair of two numeric keys (very large number or integer) that work in tandem (cycle): one for encoding and another for decoding. Message encoded with one numeric key can only be decoded with other numeric key and none other. The encoding key is kept private while the decoding key is made public. E-checks †¢ E-checks are a nother form of electronic tokens. †¢ †¢ A new electronic version of paper check. E-check is an instruction to a financial institution to pay a given amount of money to the payee. It is a specially formatted email message sent over the Internet. It contains as the same information as on paper based check. Check service providers PayByCheck (http://www. paybycheck. com) CyberSource (http://cybersource. com) Transaction Payment Sequence in E-check system Payer Transfer e-check Payee Deposit e-check Forward e-check for payer authentication Bank Accounting Server MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof.Vanita Joshi, SOM, SIMS, Indore 3 Transaction Payment Sequence in E-check system †¢ Buyer must register with third party account server using electronic check. †¢ On receiving the check, the seller presents it to accounting server for verification and payment. †¢ The accounting system verifies the digital signature on the check. †¢ Proper ly signed and endorsed checks can be electronically exchanged between financial institutions through electronic clearing house. Advantages of E-Check †¢ They work in the same way as traditional checks. †¢ E-checks are suited for micro payments. Eliminate the need for expensive process reengineering and taking advantage of the banking industry. †¢ Financial risk is assumed by accounting server. †¢ E-checks create a float through third-party accounting server. They make money out of buyers and sellers transaction by providing deposit account. Difference b/w EFT and E-check †¢ In E-Cheque, electronic versions of the cheque are issued, received & processed. So, payee issues an E-Cheque for each payment. †¢ In EFT transfer automatic withdrawals are made for monthly bills or other fixed payments; no cheques are issued.Smart cards †¢ A smart card is a plastic card with an embedded microchip containing information about you. †¢ A smart card can store about 100 times the amount of information that a magnetic strip plastic card can store. †¢ A smart card contains private user information, such as financial facts, private encryption keys, account information, credit card numbers, health insurance information, etc. †¢ So far not successful in U. S. , but popular in Europe, Germany, Singapore and Japan to pay for public phone call, transportation.Mondex Smart Card †¢ Holds and dispenses electronic cash (Smart-card based, stored-value card) †¢ Developed by MasterCard International †¢ Requires specific card reader, called Mondex terminal, for merchant or customer to use card over Internet †¢ Supports micropayments and works both online and off-line at stores or over the telephone †¢ Secret chip-to-chip transfer protocol †¢ Loaded through ATM – ATM does not know transfer protocol; connects with secure device at bank MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi , SOM, SIMS, Indore Mondex Smart Card Processing Mondex Smart Card †¢ Disadvantages – Card carries real cash in electronic form, creating the possibility of theft – No deferred (overdue) payment as with credit cards – cash is dispensed immediately Types of Smart cards Smart cards are basically of two types: 1. Relationship-based Smart Cards 2. Electronic Purses and Debit Cards Relationship-based Smart Cards It is the enhancement of existing card services that offer customers far better options like: 1. Access to multiple accounts (debit, credit, e-cash) on one card. 2.Offer various functions ( cash access, bill payment, balance inquiry, fund transfer) 3. Multiple access options at multiple location using multiple access device (ATM, PC, PDA or screenphone etc) Electronic Purses and Debit Cards Electronic Purses or E- wallet are the smart cards embedded with programmable microchip that store sum of money instead of cash. Once a purse is loaded with money it require card reader vending machine which verifies its authenticity . Then after amount is deducted from balance. It shows the remaining balance on the card hence eliminate the small bill in busy stores.E-wallets when depleted can be recharged with money . MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 5 Credit cards-based e-payment system Credit Cards †¢ A credit card is a small plastic card issued to users dealing in e-commerce. Most credit cards are the same shape and size, as specified by the ISO 7810 standard. †¢ A credit card is different to a debit card in that it does not remove money from the user's account after every transaction. In the case of credit cards, the issuer lends money to the consumer (or the user) to be paid to the merchant.Credit cards-based e-payment system Customers who purchase any goods send their credit card details to the service provider involved and the credit card organization will handle thi s payment. Online credit card payment has following categories: 1. Payment using plain credit card details 2. Payments using encrypted credit card details 3. Payment using third-party verification Entities involved in Credit card Transaction Consumer (Buyer or Card holder) Merchant (Seller) Card Issuer (Consumers’ Bank) Acquirer or Principal (Merchant’s Bank) Card Association (Visa, Master Card etc) Third party processor How an Online Credit Transaction WorksEncryption and Credit cards Encryption process starts when credit card information is entered into a browser and sent securely over network between buyer to seller. Encryption process includes following steps: 1. Customer presents his credit card information securely to merchant. 2. Merchant validates the authenticity of card holder 3. Merchant relays this information to its bank or on-line card processor. MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 6 4. The bank r elays the information to customer’s bank for authorization approval 5.The customer’s bank returns the credit card , charge authentication and authorization to the merchant Processing Payment with Encrypted Third-party authorization and Credit cards In third party processing, consumer register with third party on the internet to verify emicrotransaction. The companies providing third party payment service on internet are: ( First Virtual) †¢ http://www. fv. com †¢ http://www. openmarket. com †¢ http://www. 2checkout. com/ †¢ http://www. paypal. com/ Payment can be made by credit card via clearing house.Online Third-Party Processor (OTPPs) has following steps for buying information online. 1. Consumer registers for an OTPP a/c that is backed by credit card. 2. To purchase customer request merchant by her OTPP account no. 3. Merchant then contact the OTPP payment server with customer’s account no. 4. OTPP payment server verifies the customerâ₠¬â„¢s account no. for vender (merchant) & checks for sufficient funds. 5. OTPP server send a message to buyer that can be responded back by buyer as ; yes/agree; No/disagree; fraud. 6.If OTPP gets ‘Yes’ from customer, merchant is informed & then customer is allowed to download material. MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Indore 7 Online Payment Processing using a Third-party Processor Risk in using Credit cards †¢ Customer uses a stolen card or account number to fraudulently purchase goods or service online. †¢ Many people who will be on the Internet have not even had their first Web experience. †¢ Hackers find the ways into an e-commerce merchant’s payment processing system and then issue credits to hacker card account numbers. Many users are also likely to be younger and have less access to credit and debit cards †¢ Many purchases they make will be micropayments. †¢ Credit cards canno t be used for large sums of B2B transactions †¢ Customer falsely claims that he or she did not receive a shipment Limitations of Online Credit Card Payment Systems †¢ Security – neither merchant nor consumer can be fully authenticated. †¢ Cost – for merchants, around 3. 5% of purchase price plus transaction fee of 2030 cents per transaction. †¢ People living in rural areas don’t have same access to computers and Internet that others do. Social equity – many people do not have access to credit cards (young and old age), disabled, individuals who are not computer savvy and individuals who cannot afford cards ( poor credit risk). Designing Electronic Payment Systems Following criteria should be satisfied while designing any new E-payment System: 1. Privacy 6. Pricing 2. Security 7. Standards 3. Intuitive Interface 4. Database Integration 5. Brokers MBA-II, EBF (FT-204C) Unit-3, Study material compiled by Prof. Vanita Joshi, SOM, SIMS, Ind ore 8