Payment Systems in E-commerce

Online payment is a form of electronic payment, which is provided by a third party payment interface between banks for real-time payment. Compared with the traditional payment, online payment systems are more convenient, fast, efficient and economical. Users can use their own PC or mobile phone with Internet to complete the entire payment process in a very short time.

There are several payment methods (and organization) supporting electronic payments and ecommerce over the internet: 

• Electronic payment cards (credit, debit, charge) 
• Virtual credit cards 
• E-wallets (or e-purses)
• Smart cards 
• Electronic cash (several variations) 
• Wireless payments 
• Stored-value card payments 
• Loyalty cards 
• Person-to-person payment methods 
• Payments made electronically at kiosks 

Online banking is a very common way of online payment systems. For example, when users want to shop online. The user must open an online bank account. This payment is directly paid by credit card or even debit card. And now third-party online payment systems such as PayPal are also very popular in e-commerce.

Third party payment is an independent organization, which provides the network payment mode for transaction platform between bank and online payment platform. Third party payment mode is like a credit intermediaries to supervise and support between online business and the bank. 

First of all, for the customer third-party online payment companies can provide a variety of online payment systems, especially for small and medium enterprises. Online payment system provides a convenient payment platform to do trade with customers. For the customer, it does not only give a chance for quick payment after shopping online, but it also avoids the risk of money transfer. Online payment allows the banks to expand their business and allocate the resources on development and maintenance.
Online payment system also has plenty of risks. Financial risks are possible during the transaction process. There is a plenty of competition which may cause a negative impact on online payment. For example, in China, over 40 electronic payment companies work on third party online payment, which causes serious homogeneity in the market. The last but not the least there is law and regulation problem. Legislation regarding online payment should be established.


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