Future Direction of Virtual Payments
What, until recently, was considered near impossible, just a figment of creative imagination, today stands tall as a reality. Using plastic cards - let alone your index finger - to purchase goods, was still a fancy 25 or 30 years ago. The rapid advance in technology and the powerful emergence of digital communications have transformed the way we buy and sell. The eCommerce industry has grown exponentially over the past two decades and today one of the most popular activities for the Internet users is shopping online.
The online shopping trail, blazed by the likes of Amazon and eBay then aped by thousands of other online retailers, has turned eCommerce into a giant industry. 'Bricks and mortar' retailers have witnessed how eCommerce can transform their business by cutting costs and increasing yield. Eliminating the geographical boundaries between business and consumer, making products and services easily available online with click-easy instant buying and selling facilities can pay enormous dividends. The Web has become the first port of call for people when they are researching a product or service; this is where opinions are formed, decisions are made and, most importantly, where products are bought.
eCommerce makes the business of buying a far more complete experience, while also cutting out a lot of the hassles associated with conventional shopping. On the Web you can find what you're looking for more easily and quickly, while accessing an infinitely wider variety of products. Your purchasing is also better informed; consumers can view complete details about a product while also considering reviews of previous customers. On top of this there are countless price-comparison websites like www.confused.com that allow people to see a broad spectrum of prices on a specific product and therefore find the best deal available. Once you decide you want to buy a certain product or service, eCommerce enabled websites such as Amazon and eBay allow you to add your chosen products to a "shopping-basket". When you've finished shopping you enter a secure area of the website which takes your credit card details and you pay for the goods you've chosen ,just as you would in a real-life shop. The goods are then delivered to your location of choice which could be practically anywhere in the world.
The convenient, fast and round-the-clock features of online transactions have steered eCommerce into a direction where the demand for convenient, instantaneous secure transactional systems is now even higher. The landscape of transactional payments has changed considerably in the past decade, and the momentum shows no signs of letting up. Experts are predicting significant changes in payment processing trends within the eCommerce arena over the coming years. As these trends are intrinsically linked to the advancement in digital communications they will be swept along by the same tide of change affecting online technology as a whole. Some of the latest advancements in payment processing include:
- IP-Based Communications
Internet protocol based communications is the most important advancement of late. The fact that you are on this specific page of Traffic's website reading about eCommerce suggests that you are most likely an IP address holder. IP (Internet Protocol) not only allows you to check your emails, play games, and make Internet calls using VoIP, but can be used as a powerful payment-processing tool as well. With the help of Internet Protocol based communications, businesses are able to offer faster and more secure financial transactions. Besides this, the biggest upcoming trends in payment processing are going to be modelled on IP-based communications.
- Cash-free Transactions
This is a phenomenon we have been witnessing for some time already. A huge variety of credit cards, debit cards, prepaid debit cards and the like is already used ubiquitously across the globe. Plastic has replaced many of the transactions we used to complete with cash; the fact that even the small retailers now accept payments through such cards shows how much a part of our everyday life they are. The attitude to cards and cash is changing in the favour of cards as people find them more convenient and less hassle than cash.
- Contact-less Payments
This latest trend in payment processing features built-in radio frequency tags in credit and debit cards. This allows the customer to process the payment by just tapping his card or simply waving it from a distance of up to ten centimetres. In contact-less payment processing, signatures are required only for purchases over a certain amount, usually it's around $25 but this can vary from country to country. Many service operations such as restaurants and petrol stations are already using this novel and handy form of processing payments.
- Smart Cards
Smart Cards provide added security in financial transactions and prevent frauds. A Smart Card is a simple plastic card that looks no different to a usual credit card. They work like a normal credit or debit card; a customer's account balance decreases and increases with the purchase or deposit taking place. But unlike conventional credit cards that use a magnetic strip, Smart Cards feature a microchip, which increases the card's capabilities manifold. Acting as a microprocessor as well as a storage tool, the chip holds the complete account information of the cardholder. It also features added security tools, including automatic shut down, which deactivates the card the moment any unauthorised use is detected.
Payment processing via a person's unique physical characteristics is already in use by many grocery stores in the United States. Every individual has unique physical traits such as fingerprints, voice pattern, or the colour and shape of their eyes. Biometrics is viewed as the ultimate solution for the threat of identity theft as it provides unmistakable identity traits of the customer. One such service in place is â€š'Pay by Touch' which requires customers to simply register their bank account and fingerprint with the service to be able to â€š 'pay by touch'. Once registered, all the customer needs to complete the transaction at a participating retailer is to "swipe" their finger. Biometrics is a fantastic technology with great benefits and is poised to sweep the world of payment processing