Discuss the difference between accepting a payment online versus in person and d

Question

Discuss the difference between accepting a payment online versus in person and describe some of the problems associated with online payments from the vendor and customer points of view. Be sure to answer the following questions:
    a. How do you believe payment system benefits, complications, and complexity can help or hinder new online business owners from establishing a business online? Compare and contrast new owner scenarios with large and established businesses.
b. How do you believe customers view online payment systems?

Explanation / Answer

Suppose you are a hotel. Bookings and payments can be done online, where payments are done online. Payments can also be made by guests when checking in. When the hotel receives online payment, it means that the guest has made the payment using the internet. The payment can be made using netbanking, debit card or credit card. In such a case the bank details or the card details has to be provided on the site by the guests. The guest has to confirm the payment using their password. The hotel will receive the payment from the bank.

When payments are made in person, the guests can use cash, debit card or credit cards to make payments. Here the cards are swiped in the swipe machine and the guest does not have to provide his card details on any site. The hotel will receive the payment directly in case of cash payments and from banks in case of card payments.

Problems associated with online payment both is maintaining the security of financial information sent over the Internet. Moreover the vendor has to pay a samll part of the amount received to the associate bank or payment partner (visa, mastercard).

Online businesses are growing at a rapid space due to the convenience factor. Examples are Amazon in USA, Alibaba in China, Flipkart in India. Payment systems online plays a vital role for helping these business flourish. Due to better online security, using of one time password (OTPs) etc, consumers are comfortable about making the payments online. This helps and benefits the new online business owners.

Large and established business, which were following brick and mortar systems are also opting for online sales as the sales from brick and mortar model is falling.

Customers these days are comfortable with online payment systems, with the right security systems in place these days. As already mentioned customers use their login passwrd, CVV number, one time password to authenticate the transaction. This removes any risk involved with online payments.

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