Electronic payment, microcommerce, and digital cash systems


Click here to start

Table of Contents

Electronic payment, microcommerce, and digital cash systems



Electronic money

The pattern of electronic commerce

Electronic commerce requirements

More requirements

SSL-based payment systems

Yeah, but…

A problem with credit cards


SET, nyet?

Electronic cash


Microcommerce (continued)

Previous alternatives

What’s the problem?

Why is microcommerce difficult?

Designing a financial system

Financial system options


Public-key cryptography 1: RSA

Public-key cryptography 2: El Gamal

Public-key crypto 3: more tricks

Shared-key cryptography

One-way hash functions

Applications of one-way hashing

Performance of cryptography

Performance of disks and networks

Vendor performance calculations

Financial agent calculations

Increase transaction size

Make commissions bigger

Remove some on-line computation

Meet the MilliCent Customer

Vendor Characterization

MilliCent Vendors: Big or Small?

Why Microcommerce

Internet Business Models

The Microcommerce Model


Anonymity and privacy

Mondex, VisaCash


PayWord (Rivest and Shamir)

PayWord (cont.)

MicroMint (Rivest and Shamir)

MiniPay (now IBM Micro Payment)


MilliCent : concepts

The big picture

A typical purchase

A scrip purchase (by a customer)

The broker as a vendor

Initial scrip purchase in MilliCent

A closer look at a piece of scrip

A closer look at the scrip stamp

Scrip stamp generation

Scrip stamp validation (at vendor)

Making a purchase

Request stamp computation

The customer secret

Customer secret computation (at broker or vendor)

The cost of processing a purchase

Advantages of scrip

Features for vendor

Features for customer


Where did a transaction take place?

When did a transaction take place?


Bad transactions

Issues we haven’t begun to discuss

Further issues

Initial implementation strategy

Author: Mark S. Manasse