ad info
   personal technology

 Headline News brief
 news quiz
 daily almanac

 video archive
 multimedia showcase
 more services

Subscribe to one of our news e-mail lists.
Enter your address:
Get a free e-mail account

 message boards

CNN Websites
 En Español
 Em Português


Networks image
 more networks

 ad info



New online payment options emerging

February 3, 2000
Web posted at: 11:30 a.m. EST (1630 GMT)

by Stacy Collett

Network World Fusion

(IDG) -- About 95% of all online purchases were made with credit cards last year. But that could change as software developers and electronic payment services unveil a variety of new payment options.

People who make small online purchases - such as buying one song from a CD - will soon be able to have the transactions show up on their monthly Internet service or phone bills. The service, to be launched in the next quarter, is being developed by online payment firms Qpass Inc. in Seattle and Trivnet Inc. in Saratoga, Calif.

After registering, shoppers can purchase items from any Qpass merchant partner without using a credit card.

  Network World Fusion home page
  E-Money, Smart Card Use to Increase by 2000
  E-commerce resources - Primers and tutorials
  Web design guru predicts demise of site ads
  Reviews & in-depth info at
  Year 2000 World
  Questions about computers? Let's editors help you
  Subscribe to's free daily newsletter for network experts
  Search in 12 languages
  News Radio
  * Fusion audio primers
  * Computerworld Minute

Such micropayment services are important because inexpensive purchases can cost more to process on credit cards than the purchases themselves, said Charles King, an analyst at Zona Research Inc. in Redwood City, Calif.

Micropayments are already popular in Europe, where credit cards aren't as widely accepted as in the U.S., he said.

"About 12% of purchases in the physical world are less than $10. There's reason to believe you can approach that figure on the Internet," said Ken Kerr, an analyst at Gartner Group Inc. in Durham, N.C.

Another payment option is being developed by eCharge Corp. in Seattle and Electronic Data Systems Corp. in Plano, Texas. The two companies are planning an untraceable "electronic cash" transfer service.

The eCharge service, slated to start later this year, will let people set up prepaid accounts similar to checking or debit-card accounts and draw upon them for online purchases. People can also open credit accounts with eCharge.

Last week, San Jose-based CyberSource Corp. added electronic-check services to its online payment options. Officials said electronic-check fees are lower than the fees for online credit-card transactions.

So, what's wrong with credit cards? Analysts said the 183 million people expected to be shopping online in 2003 will want to have a wide variety of payment options to suit their personal preferences and the type of transaction being made.

A recent study by New York-based Jupiter Communications Inc. showed that 65% of online shoppers would continue to use credit cards. But 13% said they would prefer to use electronic cash, 13% said they would rather have money withdrawn from a checking account and 8% said they preferred automated teller machines or debit cards.

"In the off-line world, people use different payment methods in different circumstances," said Jupiter analyst Robert Sterling. "As online matures, we expect to see that same sort of thing happening."

Florida Gov. Bush unveils state's first e-budget
January 31, 2000
A Ticketmaster outlet in your home
January 27, 2000
Commerce One adds XML tools to e-commerce line
January 27, 2000
E-tailers take stock of holiday shopping season
January 10, 2000
Web "free delivery" is here to stay
January 5, 2000
Wal-Mart ups e-commerce bid with Web site relaunch
January 4, 2000

E-commerce resources - Primers and tutorials
(NetworkWorld Fusion)
E-Money, Smart Card Use to Increase by 2000
(PC World Online)
Web design guru predicts demise of site ads
(Computerworld Hong Kong)
Other micropayment companies
In-depth information about micropayments
Year 2000 World
Note: Pages will open in a new browser window
External sites are not endorsed by CNN Interactive.

MSN to offer eCharge service
Trivnet Inc.
Qpass: Point, Click, Purchase.
Note: Pages will open in a new browser window
External sites are not endorsed by CNN Interactive.
Enter keyword(s)   go    help

Back to the top   © 2001 Cable News Network. All Rights Reserved.
Terms under which this service is provided to you.
Read our privacy guidelines.