Lack of Security
Customers’ credit card or payment account details and other personal information have been stolen from online accounts. Despite the introduction of secure transaction mechanisms such as the Secured Socket Layer, some people still have low confidence in the security of e-payment systems.
If the systems have had a history of fraud, misuse or low reliability, and if it is a novel system without established positive reputation, consumers will be averse to using such systems, for fear of their money being misappropriated. According to a report published by marketing research firm IDC, almost half of European users of the Internet do not trust the Web merchants or fear that their details will not be secure.
A survey by Visa of 15 Banks from 12 EU countries in 2002 has also found that online credit card payments account for nearly half of all complaints. More than one in five of these came from people who had not even shopped on the Internet, but were billed for online transactions.
If the systems have had a history of fraud, misuse or low reliability, and if it is a novel system without established positive reputation, consumers will be averse to using such systems, for fear of their money being misappropriated. According to a report published by marketing research firm IDC, almost half of European users of the Internet do not trust the Web merchants or fear that their details will not be secure.
A survey by Visa of 15 Banks from 12 EU countries in 2002 has also found that online credit card payments account for nearly half of all complaints. More than one in five of these came from people who had not even shopped on the Internet, but were billed for online transactions.
Lack of Eligibility
Not every potential customer with money and intention to pay can make use of certain payment methods. For example, not everyone can obtain credit cards due to their credit history limitations, low income or other reasons.
Payment System Collision
As online payment systems are new and globalised in their usage, problems can occur when it comes to applying them to all e-commerce businesses. Some types of payments that customers are used to depending on such as PayPal or Google Wallets may not be available in other countries, even when purchasing online from those countries is an option. E-payments can also struggle to match up the values of different currencies or different types of bank accounts, leading to conflicts in completing the transaction smoothly.
Lack of Efficiency In Small Payments to Businesses
If e-payment is used for small transactions, the overhead costs which include the processing of payments and other costs in the form of a transaction fee charged may outweigh even the value of the cost of goods sold. This would not justify the use for the e-payment system if the costs outweigh the revenue that can be generated for particular firms.
Looking Forward
Despite the various concerns that have been raised, it has been predicted that there will be an upward trend in terms of the number of users of e-payment systems, as well as an increase in the number of transactions. Furthermore, the further development and innovation of other electronic payment systems such as the use of NFC have great potential. In particular, the rise of M-payments is another significant trend to note. The table below depicts the projected number of users of mobile payment in terms of a regional breakdown.
Fun Facts#15 73% of consumers who shop online prefer it because of time savings
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[email protected] Done By: Gobardja Ian U098473L Kua Li En A0070291M Nicholas Chen A0072340U Justin Tan A0072547B |