E-Commerce Lab 11 - Ayush Mittal

Contents
Introduction ............................................................................................................................................ 1
What is an eCommerce payment? ......................................................................................................... 2
How to set up eCommerce payment and how does e-commerce payment work? ............................ 2
Advantages that eCommerce payment brings. ..................................................................................... 2
Fast, convenient, suitable for the market flow ................................................................................... 2
Easy to monitor and control. .............................................................................................................. 3
Professionalize your online business. ................................................................................................. 3
Limit risks when using cash. ................................................................................................................ 3
The most popular eCommerce payment methods ............................................................................... 3
Payment by card ................................................................................................................................. 3
Payment through the gateway ........................................................................................................... 4
Payment by electronic wallet ............................................................................................................. 4
Via Mobile Banking ............................................................................................................................. 4
Via QR Code ........................................................................................................................................ 4
How does the eCommerce payment work? .......................................................................................... 5

Introduction
The boom of information technology and the Internet has created a premise for eCommerce to thrive.
With rapid growth over the years, the Internet has become the popular medium for communication,
services and commerce. The Internet and eCommerce have changed the traditional buying method of
consumers. Consumers will no longer be limited in terms of time and place where they can buy
products and services. Along with the development of information technology, digital has changed the
business environment in the world, so business transactions have also changed from cash transactions
to electronic money transactions. Transactions between business partners continue to grow on the
eCommerce platform, and eCommerce payment solutions appear to replace cash payment systems.
Electronic payments are used in the payment for goods and services purchased online through the
use of the Internet.

In Vietnam, electronic payment was born in 2008 with the first model of an electronic wallet.
Currently, many businesses are exploiting the e-wallet model, but according to information from the
State Bank, currently, only 9 enterprises such as Payoo, MoMo, Mobivi, etc. are licensed to test this
type of service.

What is an eCommerce payment?

ECommerce payment is a model of non-cash transaction that has been used in the buying process of
eCommerce and has become more and more popular in the world in recent years. In simple words,
this payment method is a transaction on the internet environment, through which users can make
payments, transfer, deposit, or withdraw money, etc.

Usually, this method is made through eCommerce payment gateways (acting as an intermediary to
carry out online cash flow transactions, with links to commercial banks) or account user’s online
banking.

How to set up eCommerce payment and how does e-commerce

payment work?
Requirements of an electronic payment system: To use an electronic payment system, you must have
an account (Merchant Account) and a payment gateway.

• Merchant account is a special bank account that allows when the business can accept
payment by credit card. Credit card payment is only possible through this type of account.
• Payment gateway is a software program. This software will transfer transaction data from the
seller’s website to the credit card payment centre to validate the credit card payment process.

On the surface, payment processing seems so straightforward: a customer loads his or her online
shopping cart, enters his or her credit card details and clicks the “buy” button. Within seconds, both
you (the e-merchant) and the customer receive confirmation of the successful sale.

Advantages that eCommerce payment brings.

E-payment is an important stage attached to eCommerce. When on the right track, there will be no
more using cash to pay when receiving goods like today. So what are the advantages of electronic
payment?

Fast, convenient, suitable for the market flow

Vietnamese consumers currently tend to make electronic payments for shopping at supermarkets,
convenience stores, luxury goods, high-value purchases, or entertainment, travel, and payment
service bills (electricity, water, telecommunications, etc.). Payment is mainly made via mobile devices
with a network connection.

Responding to the booming online business trend, e-payment is focused on investment. Shoppers can
make quick money transfers anywhere via phone without ever going to the bank.

Easy to monitor and control.

All funds are kept in transaction history and allow you to look up easily with just a few simple steps.
You can manage your finances and have a good balance of spending.

Professionalize your online business.

Most consumers, especially young people, are using electronic payment methods such as internet
banking, electronic wallet, QR code, etc. because of their convenience. Therefore, enterprises or
business owners that do not have an online payment system will also face many disadvantages.

In the long run, once consumers’ confidence has been created about the quality of goods, the payment
of cash for online purchases will no longer exist. Today’s eCommerce payment have also diversified
their forms of payment, giving users more choices.

Limit risks when using cash.

Risks of loss, lack of money, and forgetting of wallets are very likely to occur if transactions are made
in cash, especially with products/services of great value. As for eCommerce payment, all transactions
are fast, accurate to each number, transparent, clear, and secure.

The most popular eCommerce payment methods

Payment by card
This is one of the best ecommerce payment methods, accounting for 90% of all eCommerce
payments. A payment card is a card capable of paying for goods and services at a few locations,
including the website for online purchases if accepted for consumption by that card. Or you can use it
to withdraw cash directly from banks or automated teller machines. Currently, payment cards are
divided into two categories, which can be issued by banks and financial institutions. E.g.:

• Payment by international credit or debit card: If customers own cards such as Visa,
Mastercard, American Express, JCB, they can make payments at more than 60 websites
connected to the OnePay payment gateway.
• Payment by domestic debit card: This type is not popular in Vietnam but quite developed
abroad. With this eCommerce payment method, cardholders at Connect24 of Vietcombank
 or multi-function cardholders of Dong A bank can make eCommerce payments at websites
connected to these two banks as well as OnePay payment gateway.

Payment through the gateway

An eCommerce payment gateway is essentially a service that allows customers to transact at
eCommerce websites. The payment gateway provides a secure connection system between the
customer’s account (card, e-wallet, etc.) and the account of the sales website. Helping consumers and
businesses to pay and receive money on the internet simply, quickly and safely. There are also several
banks implementing top eCommerce payment gateways. Typically as:

• Payment via eCommerce payment gateway F@st Mobipay: This is a service part of
Techcombank’s payment solution. Allow customers to open accounts and make bill payment
transactions by phone message to the call centre 19001590. To ensure safety and
confidentiality for customers, you can make payment by bank transfer using Internet Banking.
• Payment via Dong A payment gateway: Since 2007, Dong A Bank has also allowed multi-
function cardholders to make online payments on “Digital Dong A Bank” using Internet
Banking, SMS Banking, Mobile Banking.

Payment by electronic wallet

E-wallet is an online account that can be used to receive, transfer money, buy phone cards, movie
tickets, pay online fees on the internet such as electricity, water bills, telecommunications charges,
you can also buy goods online from eCommerce sites. Users must own a smart mobile device with an
integrated e-wallet and link to a bank to be able to use this eCommerce payment solution.

Via Mobile Banking

This eCommerce payment solution is gradually becoming popular because almost everyone owns a
smartphone. Therefore, when shopping, customers do not need to bring cash, instead pay by phone
with a Mobile Banking service. The telephone payment system is built on a model of links between
banks, telecommunications providers, and users.

Via QR Code
Technological advancement is also the reason why QR Code payment is increasingly popular. This
eCommerce payment method is quite simple, compact, easy to use and user-friendly. QR Code feature
is currently available on mobile applications of banks, Google products and services such as Google
Chart or Google Map, on signs, buses, business cards, magazines, websites, goods at supermarkets,
convenience stores, and even on some super apps such as VinID of Vingroup.
Users use the phone camera to scan the QR code to quickly transfer, pay bills, and purchase goods.
With just one scan, after a few seconds, you have successfully made payments at restaurants,
supermarkets, convenience stores, taxis, even eCommerce websites or on any product with a code.
QR without using cash, card, do not worry about revealing personal information at payment points.

How does the eCommerce payment work?

With a payment card and a computer, a smart mobile device connected to the Internet, consumers
can complete the purchase of goods and services through the website. Here are the basic steps for
buying and paying online:

Step 1: Go to the website of the supplier and choose the goods/services.

Step 2: After the selection is complete, you will place an order by filling in the details requested by the
supplier, including Personal information, delivery method and time, way of purchase.

Step 3: The website system will display purchase invoices for you to check information on invoices.
Confirm if it is correct to proceed to the checkout step.

Step 4: If the website accepts online payments, you can complete the payment right on the website if
you own the cards that the provider accepts. Currently, eCommerce websites all accept Visa or
MasterCard branded debit and credit cards. You need to fill in card information such as Card number,
expiration date, CVV or other information depending on the request of the issuing bank. Note:
Transaction is only successful when the payment card has been registered for an online payment
function, the card information is correct and still able to pay.

Step 5: The website system will send an order confirmation email to your mailbox and contact us to
deliver the goods.