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Name Samuel R Thompson
NetID stho976
Group Number: 362
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Tutorial Details
Tutor: Day: Time:
Mira Lee Friday 11am
Time Spent on
21 hours Word Count: 1577


Have you ever enjoyed a meal at a restaurent, paid with your credit card, and then left your
copy of the receipt? Using this supposedly insignificant piece of paper, fraudsters have the
ability to make substantial purchases using your credit card number.[1. How Stuff Works
2013] Credit card fraud has so far amounted to over $55B worldwide and that number is
growing everyday.[2. Statistics Brain] Our solution eliminates the need for credit cards
altogether. Using a fingerprint transaction system would provide a convenient and safe way
to shop without the risks related to typical payment cards.
3.1 Vision
To defeat credit card fraud worldwide by providing the public with the safest and most
convenient way to shop.
3.2 Industry Analysis: Financial Transaction Processing Industry
Industry: Financial Transaction Processing Industry. Companies within this industry offer
services including electronic funds transfer and card processing.
Force: High/Low: Justification:
Buyer power: High Within this industry there are many companies
that sell various point of sale (POS) terminals and
systems for the buyer to choose from. However,
while switching costs are low, companies in the
industry attempt to mitigate buyer power
through contractual agreements.


Supplier power: Low The raw materials used in this industry are not
difficult to obtain and many manufacturers are
able to produce the equipment required.
Threat of new entrants: Low The technology behind the tangible product can
easily be manufactured. However, the high
switching costs of existing companies will make it
very difficult for any new entrant to attract
customers once in the market.
Threat of substitutes: Low In this day and age where 89% of adults in the
Western world have a personal bank account
there is no adequate substitute for a financial
transaction processing system.[3. Economist]
Rivalry among existing
High There is considerably high competition between
companies already established in the industry.
The top 50 companies worldwide account for
approximately 85% of industry revenue. [4.
Overall attractiveness of the industry: Overall, the financial transaction processing industry
is an attractive industry to pursue if a new entrant is able to gain traction once in the
market. A small startup could achieve this by providing a unique and specilized service; such
as a fingerprint transacation system.
3.3 Customers and Thei r Needs
The target group of customers for for a fingerprint transaction system would be any person
or organisation that currently relies on a transaction system to conduct personal or
commercial financial transfers. For example, banks, retailers, and the general public.
Research shows that 40% of all financial fraud is related to credit cards and that 10% of


Americans have been victims of credit card fraud. [5. Statistics Brain] This clearly identifies
the need for a more secure transaction system.
3.4 The Product and Service
A fingerprint transaction system would effectively provide security to customers by
eliminating the need for tangible payment as well as providing a payment method 100%
unique to the customer. Financial institutions would benefit from this system as they would
no longer be required to pay out to their customers who have been victims of credit card
fraud. Retail stores would benefit as the system would create a more user-friendly
experience for their customers. And the general public would benefit by having a higher
sense of security (piece of mind) as well as ultimate convenience. Our product would be
advantageous to every party involved in the transfer of funds.
3.5 Suppliers and Partners
Supplier 1: Equipment manufacturer- the procurement of raw materials and the
manufacture of the tangible component (POS terminal) of the fingerprint transaction system
must be sourced elsewhere.
Supplier 2: Delivery supplier- the tangible component (POS terminal) must be shipped from
the manufacturing facility and delivered to banks and retailers around the world.
Partner 1: Financial Institutions (banks)- Banks are an essential partner to work with as they
provide the database of customer accounts. Banks would benefit from a fingerprint
transaction system by providing an innovative and more secure system to their customers.
This would ultimately save banks money through having to pay less to customers who have
been victims of credit card fraud.
Partner 2: The New Zealand government- the NZ government may be interested in investing
in the initial startup of fingerprint transaction technology. This is because government
resources and time are spent on trying to fight credit card fraud everyday. After hearing
about our new technology they would likely be eager to join our mission to help end credit
card fraud once and for all.



3.6 Strategy: Differentiation
FTS is superior to rival products and offers banks, retail stores, and the general public a
premium service. The technology used to create the system is modern and more advance
than current transaction systems and would more than likely cost more to produce.
Therefore FTS has a high cost strategy.
FTS would target all retail stores, all financial institutions, and every person in the world who
currently rely on credit cards and POS terminals. In the United States alone there are over
28 Billion transactions made per day across 10 Billion POS terminals. [6. Gaoresearch] As our
product is expected to be utilized worldwide it clearly has a broad market.
The overall strategy is therefore: Differentiation
3.7 Value Chain Activity: Firm Infrastructure
The most important value chain activity for this business is: Firm Infrastructure
To achieve our vision of providing the most secure transaction system ever made and
ultimately defeating credit card fraud worldwide, a firm infrastrucutre is fundamental. The
need to ensure financial security is the most important aspect of our system as we are
promoting a virtually flawless design and any security breach may cause the technology to
lose its integrity. This could result in customers reverting back to standard financial
transaction systems. In order to prevent this, an effective quality control process in
collaboration with capable management and finance teams is a significant requirement.
3.8 Business Processes
3.8.1. SALES PROCESS A simplistic and security conscious sales process through the use
of a fingerprint transaction system is essential in providing shoppers, merchants and banks
with the most secure and user-friendly experience possible.






3.8.2. FAULT REPAIR PROCESS While the services that fingerprint transaction systems
provide are expected to be exceptionally safe and secure there is always the possibility of a
fault occurring. In preparation of any unforeseen flaws in the system it is important to have
a capable fault repair process ready for action. It is of the utmost importance that a fault be
dealt with quickly and efficiently, if not customers could easily lose faith and switch to
another financial transaction system.



3.9 Functionalities
Scanning fingerprints
Transferring funds
Diagnosing fault
Repairing fault
3.10 Systems

3.10. 1. FINGERPRINT I DENTI FI CATI ON SYSTEM The fingerprint identification system is the
primary factor involved in the success our product. The system is required to effectively
scan and register consumer fingerprints and then precisely identify the print to the unique
user. The system must be 100% accurate so as to ensure the safest and most convenient
way a consumer can shop.
3.10. 2. FINANCI AL TRANSACTI ON SYSTEM- This system swiftly transfers funds from the users
personal bank account to the merchants business account. The financial transaction system
works systematically with the fingerprint identification system to guarentee security. Speed
of the transaction process is essential here to provide overall user-friendliness and
3.10. 3. FAULT RECOVERY SYSTEM- In order to safeguard against any security breaches a fault
recovery system is necessary. This system would have the ability to use information taken
from the fault monitoring system to repair any discovered bugs and viruses in the software
as well as repair any issues reported by customers. This is essentially a safety measure or
back up plan should an unexpected problem arise to further increase overall security.


3.11. Summary Table: Value Chain to Systems

Value Chain
Processes Functionalities Specific Information
Broad Information

1. Sales
1. Scanning Fingerprints

2. Identifying Fingerprints
Fingerprint Identification
Financial Transaction System
Transaction Processing
Transaction Processing
2. Fault
1. Diagnosing Fault

2. Repairing Fault
Fault Monitoring System

Fault Recovery System
Transaction processing
Decision Support System


To conclude, the need for a more secure transaction system is imperitive. Far to much time,
energy, and money is being wasted on fighting financial fraud. Replacing traditional
transaction systems with fingerprint transaction systems would effectively solve the
problem and create a financially safer world. Eliminating the need for any sort of physical
payment device through the use of IS/IT would provide the general public, privately owned
businesses, large retail chains, and large financial institutions around the world with
complete security and convenience. Fingerprint transaction systems are the way of the

1. Lee Ann Obringer (2013). How Identity Theft Works.

2. Statistic Brain, (2012). Credit card fraud statistics.

3., (2012). Banking in the Devloping World: The Poor are Different.

4. Hoovers (2014). Financial Transaction Processing Industry Overview.

5. Statistic Brain, (2012). Credit card fraud statistics.

6. Gaoresearch, (2014). Point of Sales Systems (POS) Advanced Electronic Payment
Systems and Dial-up Technologies.