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Chapter 15. Payment Systems > Online Credit Card Payment

Online Credit Card Payment

Credit cards have become the most common means for consumers to pay for goods and services on the Internet. This is not surprising, because many Internet transactions are very similar to mail-order transactions. Consumers are already familiar with credit cards, and the credit card system lowers the risk to the consumer if something goes wrong. From a technical point of view, it is much easier to create a system for processing credit card purchases than to invent a new payment technology. Finally, from a business point of view, many merchants who want to do business online already accept credit cards, so taking advantage of online opportunities does not require establishing a new banking relationship.

Secure Communication

The first credit card transactions on the Internet were not protected against eavesdropping. Early transactions consisted of credit card numbers (and related information) sent by electronic mail, Telnet, or the World Wide Web without encryption for privacy. As electronic commerce systems began to be deployed more widely (primarily on the World Wide Web), system designers took two other approaches: obtaining credit card numbers for customer accounts by telephone rather than over the Internet, and developing encryption systems and security protocols for transmitting the information. Two of the first encryption protocols for the World Wide Web, Secure HTTP and the Secure Sockets Layer (SSL), were developed in part to enable commerce applications.


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