Why is e-commerce gaining popularity nowadays? List out the payment mechanisms commonly used in e-commerce.

A Management Information System ICT Revision Questions and Answers

Answer
E-commerce or electronic commerce is defined as the exchanging of the commodities between consumer and seller with the help of electronic media instead of traditional channel of business. Use of digital technology in the purchasing and selling of the product and services bringing the consumer and trader together is the main philosophy of e-commerce. As e-commerce facilitates

the trading between people or organization of any part of globe together with the click of computer it is being very popular.
One of the major concerns of the e-commerce is the way payment is done during the course of business. The payment mechanism in the e-commerce can be any one of followings:
Digital Credit Card:
It is the extension of credit card into the internet so that it can be use for the online payment. The information dissipated through the Internet is protected for merchant, consumer and processing bank authorizing and authenticating.
Digital wallet:
Digital wallet makes paying for purchase over web more efficient eliminating the need for shoppers to repeatedly enter their address and credit card information each time they buy something. A digital wallet securely stores credit card and owner identification information and provides that information at an electronic commerce sites. The digital wallet enters the shoppers name, credit card number and shipping information automatically when invoked to complete the purchase.
Micropayment:
It is developed to make the payment of less than 10$ as such payment will be too small to pay through the credit cards. Accumulate balance payment system facilitates such type of small payment in the web accumulating it into the debit card or in credit card.
Stored value payment systems;
It enables consumer to make the instant online payment to merchants and other individuals based on valued store in digital account. Online value systems rely on the value stored in consumers‘ bank, checking or credit card account and some of this system requires the use of digital wallet.
Digital cash:
Digital cash which is also known as e-cash can also be used for micropayment or larger purchase. It is the currency represented in electronics form that moves outside the normal network of money. Users are supplied with the client software and can exchange money with another e-cash user over the internet or with retailer accepting e-cash.



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