Electronic Commerce (E-Commerce) is simply any business transacted electronically.
In today's parlance it has come to mean "Business transacted over the Internet".

1. Merchant Account. The Merchant Account gives you the ability to take Credit Card information from your prospective customers. There are many sites on the Internet where you can apply for a Merchant Account. Typically you pay from $200 - $500 to start this process. Ultimately the Merchant Account is issued through an Authorizing Bank.

Think of the Merchant Account as a Drivers License. Just because you have a Drivers License doesn't mean you can drive. In order to move around you need a vehicle! Likewise - in order for you to use your Merchant Account you need a vehicle to move the information around. An example of how to move this information might be a telephone. You could just ask your website prospects to call you on the phone. The phone is then your vehicle to move the Credit Card information.

2. Online Shopping Cart software is another example of a vehicle to move Credit Card and ordering information. Your customers can efficiently order 24 hours a day. Also a Shopping Cart eliminates some potential for error because there is only one human involved in the process - rather than two. Online Shopping Cart software also increases your credibility on the Internet.

The Shopping Cart is a vehicle that enables you to; Get the ordering information from the customer; Verify via email to the customer that the order has been made; Deliver the notification and ordering information to the seller. The more information the shopping cart can collect - the wider it's application can be.

3. Transaction Device or Software is how you Deliver the money. Now that you have the customers money - (Credit Card information)- you need a place to deposit it. Your Bank! But you still have some choices to make. Are you going to walk in and place the transaction with the Teller? Are you going to drop it in the Night Deposit box? Are you going to utilize the bank's Drive In option?

In the same manner you have to decide how you are going to deposit the E-Commerce transaction into your bank account.

Here again you have 3 basic choices.

• A device in your office to enter the transaction over the phone lines. This device will be similar to those you see in retail stores when you buy something using a credit card. There are many options with widely varying prices.
• Internet software that enables you to 'deposit' your transaction over the Internet. Typically by filling out an online form. Here again you will find a rather wide variation - in most cases you will need to rent the software on a monthly basis.
• Real Time Credit Processing. This is the service provided by companies such as AuthorizeNet. Using this method your Shopping Cart interfaces with the Real Time Credit Processing company to complete the transaction. This takes place automatically while the customer is placing the order. Using this method the customer and the seller is notified as to whether the credit card account has sufficient funds to enable the transaction.