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Beginners' Guide to E-Commerce
Alternative Ecommerce Methods
Various technologies have been developed that provide alternative
methods of ecommerce. At this time, credit card transaction is by
far the method preferred by online shoppers. However, offering one
or more of these alternative methods gives consumers a choice. Not
everyone has a valid credit card, and some people are still leery
of online transactions.
Telephone Billing Services
Telephone billing services allow the customer to purchase an item
or service and have the amount billed to his or her telephone bill.
To date, this is being used for the sale of soft
items such as downloads, time measured services (i.e. time spent
at a Web site) or for making charitable donations online. eCharge
Corporation is a pioneer in the use of this technology.
Pros
• Eliminates worries about credit cards (for both consumer
and merchant)
• Available to customers without credit cards
Cons
• Customer is required to download and install a plugin. Many
customers will balk at this, lacking the skill or interest to install
additional software on their computer.
• Primarily available only for soft goods that can be downloaded.
• Use may be limited to consumers with certain operating systems
and browsers. AOL subscribers may encounter problems.
• Available only to customers accessing the Internet through
telephone lines (i.e. dial-up). Will not work for transactions over
cable modems, ADSL, T1 and ISDN lines.
• Available only to consumers living in certain countries
where agreements are in place with local telephone companies.
• Consumers who have blocked 900 number calling on their phones
will not be able to use the service.
Electronic Payment Systems
These systems allow merchants and consumers to set up accounts and
engage in cashless trading on the Internet. The consumer must set
up a free account, then transfer funds into the account. When shopping
at a web site offering this service, the consumer will initiate
a transaction that will transfer funds from his/her account to the
merchant.
Pros:
• Available to merchants and consumers anywhere in the world.
• Merchant does not need a merchant account.
• Goods can be sold for as little as onc cent US.
Cons:
• Consumer must download a plug in, which many do not like
to do.
• Consumer must transfer money into the account.
• Consumer can use this service only with participating merchants.
Cybank is an example of this type of service. (http://www.us.cybank.net/)
Person to Person Technologies (P2P)
P2P technologies allow bill payment through email. The merchant
opens an account with one of the P2P companies providing this service.
The accounts, often free to open, require your contact information,
credit or debit card information and your bank account
information. When a customer initiates a transaction from your web
site, he or she will be required to open an account. According to
the customer's instructions, the money for the purchase will then
be charged to their credit card and the merchant will receive an
email saying that the money is ready to be picked up. Depending
on the service's options, he could opt to have the money transferred
into his bank account, credited to his charge card or he
could request that the service cut a paper check.
1. Paypal. (www.paypal.com).
Rated highly by Forbes and others. Offers both personal and business
accounts. Some availability to persons living outside the US.
2. MoneyZap(www.moneyzap.com)
From Western Union. Transfers directly from bank accounts.
3. Payplace ( www.payplace.com)
Better suited for business use than for consumer use.
4. Billpoint (www.billpoint.com)
eBay's own technology. Takes a cut of auction transactions.
One Stop Shops
Recently, with the huge interest shown in ecommerce, a multitude
of services and products have become available. It's now relatively
simple to find a service that will broker your Internet Merchant
Account, as well as providing web site storage, a template for designing
your site, shopping cart software, a form generator, a secure line
for safe online ordering, and more.
Visit Google (www.google.com) and run a search for "ecommerce
solutions."
International Merchants
Unfortunately, for merchants living in countries other than the
US, many of the services available on the Internet are available
only to US merchants.
AND -- a word of warning! Many of the businesses offering ecommerce
services on the web are run by resellers who do not fully understand
who is eligible and who is not. You can waste many hours and many
dollars with some of these services before discovering that the
service isn't available in your country.
For example, some service reps will tell you that the service is
available to you if you have a US Postal Box and a US bank account.
It is not difficult to acquire a US Postal Box if you are able to
visit that country, and your own bank will probably be able to set
up a US bank account for you. However, this is not the solution.
You will discover later that you really need an actual business
address in the US and a business bank account that is set up in
the US. This will require a US taxation number. To get a taxation
number, you will have to incorporate your business in one of the
US States. This will require filing a US tax return as well as a
tax return from your own country. So --- be cautious of anyone assuring
you that a bank
account and postal box are all that is necessary.
Enough of the bad news. Satisfied customers from various countries
around the world have recommended the services that follow. Each
listing is based on at least one endorsement. No doubt, many good
services are not included.
Going to Google (www.google.com) and running a search for "international
merchants" will turn up more.
ClickBank (http://www.clickbank.com/)
ClickBank Company's card processing service has been highly recommended
for persons selling digital products (files, software, ebooks, digital
music, etc.). The setup fees are modest and the service is said
to be available to merchants anywhere.
Kagi (http://www.kagi.com)
Several satisfied merchants from outside the US gave this outfit
kudos for their services. Kagi was developed to accommodate payment
for "soft merchandise" such as software, files, music,
graphics, etc., but also accepts payment for "hard goods"
as well. Kagi accepts credit cards and checks on your behalf. They
keep a small percentage of the total sale, plus whatever discount
rates they were charged by the credit card company involved. There
is no start up fee. This appears to be a small company but their
satisfied customers suggest that they provide good service.
Valis International (http://www.valis.org/)
A merchant from Ireland reported that this company was the only
one that could get things sorted out for him. Valis provides assistance
with incorporating in the US, getting a US bank account, US Merchant
Account, and offshore issues.
Vantage Services Inc. (http://www.vanserv.com/)
This credit card processor specializes in providing services to
non-US merchants. They were the first ecom service to receive the
Internet Better Business Bureau seal of approval.
Internet Secure (www.internetsecure.com)
This Canadian company was the first in Canada to provide credit
card processing services to Canadian merchants. It is now available
to merchants in selected countries around the globe.
Internet Billing Company (aka iBill) (www.ibill.com)
Some satisfied clients suggested the Internet Billing Company (aka
ibill'). iBill offers an array of ecom services, some of which are
available to international merchants.
PayPal (www.paypal.com)
A P2P service mentioned previously. PayPal offers limited services
to people living in 25 countries other than the US. As a non-US
resident in one of the participating countries, you can use PayPal
to credit and debit your credit card, but you cannot transfer money
to or from your bank account. As of February 2001, PayPal made bank
account transfers available to Canadians.
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