E-Commerce (part 2.b)

B. Service Transactions

Other e-commerce businesses offer services. Financial services represent a large segment of e-commerce. For a small fee, online investment brokerages trade stocks on behalf of their clients. Online stock brokerages typically charge customers lower fees than traditional stock brokerages. Other sites provide consumers with a way to research and obtain mortgages and other loans online.

Travel sites offer a method of scheduling airline flights, renting cars, and booking hotel rooms. Travelers can plan all the details of their vacation or business trip, make reservations, and purchase tickets at the same site. Such sites also offer maps, travel literature, and booking information for travelers.

C. Auctions

Some e-commerce sites specialize in bringing buyers and sellers together, rather than selling products from their own inventories. Online auctioneers provide sellers a way to list and display items for sale and take bids from interested buyers. An online auctioneer may bring together millions of users and feature more than 700,000 items at any given time. In exchange for the auctioneer's services, sellers pay the auctioneer a small fixed fee and a portion of the proceeds from the sale. Other sites invert this model. These sites enable bidders to name the price they are willing to pay for a particular product or service and then try to find a seller who is willing to meet that price.

D. Business-to-Business Transactions

Business-to-business commerce represents one of the fastest growing segments of e-commerce. Businesses order supplies and coordinate complicated projects electronically. For example, construction companies use e-commerce to order construction materials and coordinate the work of subcontractors. Before e-commerce, this work was conducted via telephone, facsimile, and regular mail. Subcontractors often lost time waiting for necessary parts to arrive or for another part of the project to be completed. With e-commerce, however, software can automatically track the inventories of manufacturers and suppliers so that both have adequate supplies on hand and no longer need to have excess inventories. Reducing inventories enables both manufacturers and suppliers to lower costs. The labor-intensive method of printing and then faxing or mailing purchase orders can also be avoided because software can create purchase orders and send them electronically.

E-commerce helps trucking and shipping companies match shipments with shippers. Before e-commerce, it was not uncommon for trucks or ships to drop off a shipment and then return to their base of operations empty. This practice was inefficient and cost the trucking or shipping company money. Specialized e-commerce software, along with the Global Positioning System (GPS), enables trucking firms to track the whereabouts of their trucks at all times and make better decisions as to how their trucks are routed so they can respond efficiently and cost-effectively to companies that need their services, dramatically reducing the number of trucks returning empty.

Banking

Banking in recent years, banks have made their services increasingly convenient through electronic banking. Electronic banking uses computers to carry out transfers of money. For example, automated teller machines (ATMs) enable bank customers to withdraw money from their checking or savings accounts by inserting an ATM card and a private electronic code into an ATM. The ATMs enable bank customers to access their money 24 hours a day and seven days a week wherever ATMs are located, including in foreign countries. Banks also offer debit cards that directly withdraw funds from a customer's account for the amount of a purchase, much like writing a check. Banks also use electronic transfers to deposit payroll checks directly into a customer's account and to automatically pay a customer's bills when they are due. Many banks also use the Internet to enable customers to pay bills, move money between accounts, and perform other banking functions.

Positive Affect

1.      Bill Payments

Bill payments lets you make payments directly from your bank account to some other company's account, such as making a payment for a store credit card direct from your account rather than by writing a cheque or arranging a money order.

2.      Money Transfers

Most online banking services will allow you to transfer money between accounts, such as to and from an associated savings account.

3.      Standing Orders

Setting up and managing standing orders is a common banking function and most online banking services will allow you to manage your existing standing orders, as well as create new ones if necessary.

4.      Direct Debits

Direct Debits can be a convenient way of ensuring that regular payments for services are made at a particular time each month. Most online banking services will allow you to make changes to existing direct debits or set up new ones should you so wish.

5.      Transaction list

Perhaps the most obvious use for online banking is to obtain a recent list of all the transactions on your account. This is similar to the monthly statement you would ordinarily receive, however it lets you check all recent transactions.

Negative Affect  

1. Customer Support  

As with any new technology new problems are faced. One of the first problems that banks have to worry about is customer support. Banks have no customer relations department.

 2. Instant Help  

Banks have no customers receive assistance quickly if they need help. Any major problems or disastrous can destroy the banks reputation quickly an easily.

 3. Software  

Another major issue in banking is the software that will be used in order to support the network. The first major concern is with laws. While Internet banking does not have national or state boundaries, the law does. Companies will have to make sure that they have software in place that can detect when an interstate law is being violated.

 4. Credit Card  

Another concern with software is over the company that manufactures it. Microsoft and Visa have formed an alliance while Netscape and Master Card have done the same. These alliances allow the Internet service provider to establish secure online transactions. Since Microsoft has an 80% market share on the software used by PC's it can possibly dominate the bank software market, creating a monopoly.

 5. Security  

Security of course is a huge issue with banks. Along with security, encryption, and managerial issues, a bank also has to worry about becoming too cold a distant to the customer. Some feel that banks who offer Internet banking our becoming more and more cold and impersonal with respect to the customer.

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