Introduction:Electronic Payment is a financial exchange that takes place online between buyers and sellers electronically without the use of actual cash or money. Electronic payments are far cheaper than the traditional method of mailing out paper invoices and then processing payments received.Objectives of study:To understand the working of the e-payment based application.To understand the security aspects of the e-payment services.To know the overall impact of e-payments on the economy.To understand the adaptiveness of people from traditional paper currency. History of money:Barter System: It’s one of the oldest means of payment involving the exchange of goods.Commodity Money: Physical commodities which have recognized value. E.g.: Salt. Mostly it’s gold & silver coins.Commodity Standard: Use of tokens (e.g., paper notes) which are backed by deposits of gold and silver held by the note issuer.electronic money: End of 20th century. Which are paper tokens and metal coins are replaced by the electronic representation of money.Advantages of E-Payments:It’s the most convenient mode of payment for the customer.E-payments lowers the cost for businesses.Transacting is as simple as clicking your mouse & confirm your payment.Reduces the use of paper.There’s an instant transfer of money, enables faster work completion.Business transactions can be done 24*7*365.It has worldwide acceptance.Disadvantages of E-Payments:Transaction fee per transaction and monthly fees are more.They are prone to hacking and other another online threat.Not all websites support a particular payment method.E-payment system:EFT is defined as “any transfer of funds initiated through an electronic terminal, telephonic instrument, or computer so as to order, instruct, or authorize a financial institution to debit or credit the account”.EFT utilizes computer and telecommunication components both to supply and to transfer money.Classification of EFT:EFT can be segmented into three broad categoriesBanking and financial paymentsLarge-scale paymentsSmall-scale paymentsHome paymentsRetailing paymentsCredit cardCharge cardOn-line electronic commerce payments.Token-based payment systems.Credit card-based payments systems.Main security requirements for e-payment:Authorization:A payment must be authorized by the payer.Needs payer authentication(PIN, digital sign).Payment may also need to be authorized by the bank.Data confidentiality and authenticity:Transaction data should be authentic.External parties should not have access to data.Availability and reliability:Payment infrastructure should always be available.Centralized systems should be designed with care.Critical components need replication and a higher level of protection.Atomicity of transactions:All or nothing principle: either the whole transaction is executed successfully or the state of the system doesn’t change.In practice, transactions can be interrupted (e.g., due to communication failure).It must be possible to detect and recover from interruptions (e.g., to undo already executed steps).Privacy:Customers should be able to control how their personal data is used by the anonymity means that the customer hides her identity from the merchant.Untraceability means that not even the bank can keep track of which transactions the customer is engaged in.E-Payment modes:Credit payment system:Credit card: It’s one of the e-payment method cards which are issued by the bank allowing the holder to purchase good & services on credit basis with some other agreed charges. It generally involves a promise to pay the credit in future. It involves from capturing card information, approval from the issuer, payment of money, and monthly statement to the customer.E-Wallet: E-wallet is an electronic device allows to make electronic transactions. It can be through a computer (Website) or through the smartphone (Application). It stores the debit or credit card information of the user to facilitate a quick transaction. E.g. paytm, Tez app.Smart card: Smart cards are the plastic card with microprocessors that can be loaded with funds to make a transaction. They are usually used in places like Metro traveling, health cards etc.Cash Payment System:Debit card: The holder of debit card instructs his bank to make a debit of the amount of transaction from his account for the payment of goods and services. The debit card only works if the holder has money in his account to cover the transaction amount.E-Check: E-check is a form of online payment where the money is electronically transferred from payers account to the payees account upon the authorization. It generally takes 3-6 business days to complete. The merchant can withdraw payment for goods and services from the customer upon the authorization by the customer.E-Cash: E-cash simply is an electronic cash or e-money that provides a way to pay for goods and services without the use of paper currency. It involves authorization, payment confirmation.Security issues:Security is the main issue of the present-day scenario in making an electronic payment. Most of the security issues majorly found attacks of viruses, worms, and Trojans. The viruses are spread through e-mails or any downloading unwanted content. Recently viruses are also spread through the apps like WhatsApp, Viber etc. there are a number of malicious programmes and viruses which can attach the online banking easily by stealing passwords on browser. Major Threat:Worms: Worms are the special viruses that are spread through direct internet connection where there is a direct connection and spread from one computer to another computer that usually steals the user’s information.Trojans: Using the Trojans the hackers can bypass the authentication in e-payments. Trojans generally steal the confidential data or the sensitive data of the users. Denial of services attack (DOS) or Distributed Denial of services (DDOS): It is another common method that disturbs the electronic payment system where hackers place the software on different third-party systems that sends request to the target systems (DOS) attacks generally target the sights on the web servers that might be a bank server.Phishing: It is a method that is generally used to obtain the personal information by acting as a trust worthy organization. Hackers generally send an e-mail from a good organization or a bank or a financial institution and try to obtain the information about the account details of the users. Once the user gives the required information unknowingly then the hacker will gain access to the user’s account.Pharming: it is a generally a fraud that divers the internet connection of the user to a website which is exactly same. So, when the user enters the site that site will be a forged site.Drive-by Downloads: Drive-by download may happen when visiting a website or clicking on a particular link or an ad or popup. These are the clicked mistakenly by the users. The attackers create malicious content and can explore vulnerabilities. Drive-by download contains malware which is a major thread to e-payments.Solution:Authentications: An effective authentication should be implemented for a better transaction through e-payment. Instead of a single authentication, multiple layers of authentication should be implemented for better security.Multiple layers of authentication may be of a PIN, CRYPTOGRAPHIC KEY, DIGITAL SIGNATURE etc.,Biometrics: Biometrics are the security devices where the devisers check the person voice or finger pattern or eye retina for authentication which makes e-payments more secure and safe the biometric security devices or more likely to be in future.Encryption: Encryption means the process of encoding and decoding a message. Encryption consists of encryption and decryption keys that allow the users to make a secured payment encryption is used for a secured and safe online transactions by the end to end encryption.Firewalls: Firewalls are the security system which usually controls the incoming and outgoing traffic and blocks access for unwanted or un trusted files the file which has permission or given access to the system information by using the firewalls the e-payment security can be increased.
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