Companies team up to create secure, worldwide cybermall
June 29, 1996
Web posted at: 6:45 a.m. EDTSAN FRANCISCO (CNN) -- A group of top financial institutions, credit card companies and software giants last week in San Francisco announced an agreement to convert the Internet into a secure global shopping mall.
The agreement between Verifone, a Redwood City, California, company that makes credit-card processing technology, Visa, Mastercard and several banks and software companies, was a significant step, since security is one of the biggest concerns about Internet shopping.
The kind of seamless commerce that exists at grocery store checkout counter has not been possible on the Internet, for a number of technical reasons.
For one thing, a Web purchase exposes the consumer to the dangers of someone intercepting their card number. For another, the credit card company is not in the loop, and to get credit approval, the merchant must relay the card number by phone.
The process isn't quick or seamless, and it's less than secure.
"Consumers don't care how payments are going to happen," said Roger Bertman, executive vice president of Verifone Internet Commerce. "They want them to be secure, they want them to be convenient."
In an effort to fulfill that need, Verifone has created an Internet payment system that hinges on letting the merchant, bank and credit card company know it is really owner of the card -- and not someone else -- who is making a purchase.
It does so by giving each customer a secret digital signature assigned by a bank or credit card company and stored on the customer's computer hard drive.
The signature will be encrypted as it travels across the Internet from customer to merchant, and thus will be safe from misuse, Bertman said.
"Wen a transaction has been implemented over the Internet using this technology, even if somebody has that information, they can't utilize it," Bertman said. "They don't know what it says."
For the consumer, Verifone promises simplicity and security. And for the merchant, it offers a special bonus.
"The majority of Internet access is done by consumers who are paying for their own access point," said Dudley Nigg, executive vice president at Wells Fargo Bank. "They get into the system without incurring any further cost to (the merchant)."
This means merchants save a lot of their money, which is one big reason why businesses are eager to see Internet commerce take off.
Related stories:
- CNN - New Web Security - Jan. 16, 1996
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