Means of payment

• Credit card
  
• All kinds of Electronic money, Ecash (or digital money)
  
• Pay by mobile phone
  
• Cash on delivery (C.O.D.)
  
• Cheque
  
• Money transfer / delivery on payment
  
• Postal money order

Credit cards are still used to pay for more than 98 percent of online retail transactions. But alternatives - particularly person-to-person systems and micropayments - are gaining traction.

One p-to-p option, PayPal, started on eBay but is now accepted at a number of online stores. Its main advantages: simplicity and security. Some buyers still get the willies when asked to type in their credit card numbers at an e-store. PayPal lets them avoid that anxiety. Once they set up a PayPal account, they just click the Pay button on a PayPal-enabled checkout page, enter a password, and they're done. PayPal handles the behind-the-scenes payment processing.  If you don't have a Paypal account, I highly recommend that you get one!

Micropayments - transactions too small for standard credit card systems to handle economically - make up a minute portion of online payments. But more and more merchants are experimenting with them. Amazon.com, for example, recently started letting buyers pay a couple of bucks to download individual songs. Micropayment systems come in two main forms: Some vendors, such as Flooz.com, issue what amounts to private currency; you buy a batch of tokens or scrip with your credit card, then use it to pay for items. Other e-retailers use brokers such as eCharge and iPin that attach micropayments to phone, utility or ISP bills.

Security issues

User and payment data is encrypted by SSL when it is transferred on the Internet. Quality seals can be placed on the Shop webpage if it has undergone an independent assessment and meets all requirements. The purpose of these seals is to increase the confidence of the online shoppers. But the existence of many different seals foils this effort to a certain extent. Customers are afraid of credit card fraud, which has happened even at large online shops. Privacy of personal information is also a big issue. In spite of Privacy Guidelines of the OECD, for example, privacy violations still occur and hamper eCommerce from developing to its full potential.

Secutiry issues are explained in the next chapters and in the last chapter in detail.