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EBS Online GatewayE-payment Gateway Analysis
Mohit Sharda (192018)
Nitesh Singh(192021)
Rohit Batura(192031)
Prateek Arora(192025)
Vaibhav Raj Bahadur(192043)
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Objectives
To determine the viability and appropriateness of
implementing an online payment service as part of
the EBS
To outline the viability and potential uptake of e-
payment services
To inform the portal Tender Specification
To identify Issues and Requirements
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Purpose
Determine the factors involved with delivering e-
payment facilities from the EBS Online Gateway with a
focus on :
consumer payment trends and preferences
key e-payment methods available
high level analysis of RBI Payment Options. adoption options
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Key Questions
Should the portal offer e-payment facilities?
If so what e-payment facilities should it offer?
What should be the portals role in offering the e-paymentfacilities?
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Methods ofInvestigation
High level strategic analysis
Focussed on G2C and adhoc G2B only
Utilised a significant amount of 3rd party research includingconsumer and industry research and analysis
Two agencies active in e-payments consulted
Expert group reviewed Draft Report and provided feedback
Very limited primary research conducted (e.g. no consumer
research and contacted only a few service providers)
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Findings
Two categories of online payments:
Online purchase of goods and services
Online bill payment
Two e-payment methods
Payment
Categories
Purchase of
Goods and
Services
Bill Payment
Viable Online Payment
Methods
Internet
Payment
Gateways
EBPP
suitable for
PwC November 2001
Figure 1: Viable Payment Methods for Payment Categories
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Online Purchases
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Findings: Online Purchases
Number of internet users making online purchase is expected to grow
strongly to 70% by 2015
Will fuel expectations and the demand for online government purchase
capability over the next 5 years
Consumer research commissioned for the EBS found that over 30% of all
respondents said that paying fines and making government purchases
would be one of the functions that would most like to access from EBS
Total Users
Users Making Purchases
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Findings: Online Purchases
There are currently few online Indian Government transactions
Current online government transactions cannot be accessed in one
location, though Multi-Service Express has improved this situation
Recommendations
A minimum EBS online payment function is to provide access from
the home page to a Web page that consolidates all online
transactions
provide a listing with appropriate links that then on-sends the
consumer to the department level payment site
accompany online transactions with the correct meta data to
allow them to be searched and collated
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Findings: Online Purchases
Last year 82% of all purchases were made by credit card
Yet only 44% preferred to use credit cards
Primary Method of Payment of Goods Purchase Over the Internet
IDC Project Marco Polo 2000
%
Preferred Method of Payment of Goods Purchase Over the Internet
IDC Project Marco Polo 2000
%
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Issuing Bank
Issues card
Extends credit
Assumes risk of card
Cardholder reporting
Card
Association
Merchant
Merchant Bank (Acquirer)
Sets up merchant Extends credit
Assumes risk of merchant
Funds merchant
Consumer
Processor Processor
Process : Online Credit Card Purchases
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Findings: Online Purchases
Internet Payment Gateway for credit
cards only viable online payment method
currently and in near future due to:
a lack of acceptance
consumer behaviour
consumer fears regarding security
authentication requirements
speed of settlement
Current products immature, but market
increasingly competitive
On-Line
Authorisation / Settlement /
Decline @ Point ofSale
Internet Payment Gateway
PwC adapted from Opentec Website November 2001
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Findings: Online Purchases
Internet Payment Gateway for adoption options:
Decentralised where departments and agencies implement their own
solutions/choose their own service providers
Centralised Build where the EBS builds its own gateway service and associated
transactions services which is used by all of government
Mandated Centralised Preferred Supplierwhere a pre-approved preferredgateway service supplier is mandated by the EBS and is required to be used by
the whole of government for all transactions
Optional Centralised Preferred Supplierwhere a pre-approved preferred
gateway service supplier is optional for existing or commenced implementations
but mandatory for all new implementations
Optional Centralised Preferred Suppliers where pre-approved preferredgateway service suppliers are available to be used at the department/agencies
own discretion. This could simply be in the form of a listing of providers that meet
required specifications
Centralised Collection where the EBS or another government agency manages
all government transactions and online collections
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Findings: Online Purchases
Issues considered at a high level when evaluating adoption options:
implementation costs (new solution)
migration costs (existing solution)
service delivery (eg features, flexibility, responsiveness/time to market)
service provider charges (fixed and variable/transaction)
competition among service providers
department/agency choice and flexibility
synergies (shared learning and infrastructure)
consumer utility (eg choice and consistency of payment methods)
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Recommendations: Online Purchases
Optional Centralised Preferred Suppliers model recommended
payment gateway providers are screened and pre-approved
Departments use preferred suppliers at their own discretion
EBS is not a transactional portal and simply on-sends consumers
Advantages
Lower implementation
Lower migration costs
Greater departmental flexibility
Leverage service delivery & price improvements between re-tendering points
Only two parties (bank & merchant) involved in reconciliation*
Ado
tio ptio Rating Recommendation
Decentralised 3
I
LY
entralised
uild 1
andated
entralised
re
erred
upplier 2
ptional
entralised
re
erred
upplier 3
I
LY
ptional
entralised
re
erred
uppliers 5 YE
entralised
ollection 1
Adoption ption r
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Recommendations: Online Purchases
Centralised Build not recommended
Build own gateway and associated transaction services
Departments must use or migrate to gateway
Product/price/service levels determined centrally
Disadvantages Likely to be more expensive than private sector solutions
Cannot leverage private sector service delivery & price improvements
Likely to be less responsive and slower to market
Limits department flexibility
Adoption
ption Rating Recommendation
Decentralised 3
I
LY
entralised
uild 1
andated
entralised
re
erred
upplier 2
ptional
entralised
re
erred
upplier 3
I
LY
ptional
entralised
re
erred
uppliers 5 YE !
entralised
ollection 1
Adoption ption r
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Recommendations: Online Purchases
Centralised Collection not recommended
Manages all government online transactions and collection
Departments must use or migrate to new service
Product/price/service levels determined centrally
Disadvantages Additional intermediary likely to add to transaction cost
Competition not encouraged
Departmental choice/flexibility limited
Lack of single point of accountability (e.g. three parties potentially involved in
reconciliation) and liability
Adoption"
ption Rating Recommendation
Decentralised 3#
$ % %
I&
LY'
entralised&
uild 1(
$
)
andated'
entralised#
re0
erred%
upplier 2(
$
$
ptional'
entralised#
re0
erred%
upplier 3#
$ % %
I&
LY$
ptional'
entralised#
re0
erred%
uppliers 5 YE 1'
entralised'
ollection 1(
$
Adoption ption r
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Findings: Online Purchases
E-payment gateway provider must link to RBI as it is the acquiring
bank under the whole of government bank contract.
Banking contract is to be reviewed next year. All else being equal,
changing banks likely to be difficult.
Limits the available third party Internet payment gateway providers
Recommendations
Selecting a provider/s that links to all of the banks will minimise themigration required if a new government bank is chosen
Objective of obtaining optimal Internet payment gateway rate
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Online Bill Payment
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Online Payment Diagram
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Findings: Online Bill Payment
Bill Payment = Electronic Bill Payment & Presentment (EBPP)
EBPP providers consolidates and presents bills and allows payment
*Electronic bill presentment & payment (EBPP)
Biller
e.g. UtilityBiller service
provider
EBPP
ConsolidatorConsumer service
provider
e.g. banks and portals
Consumer
Mature EBPP Model
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Recommendations: Online Bill Payment
Payment Due to the massive growth in popularity of EBPP services all major
government billers should consider offering their services via current3rd party EBPP services.
The EBS should also adopt a short to medium term vision ofproviding/distributing a third party EBPP service via its gateway whichwould provide a useful function for consumers and help to generate
traffic for the gateway.
EBS should not build a bill presentment or payment portal itself. It
should
investigate the maturity and feasibility of existing product/s and businessmodels
possibly allow the existing product/s and business models to maturesomewhat before commencing this investigation.
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THANKS
QA&