Chapter 1 Overview of E-Payment System

University of Information Technology – Vietnam National University, Ho Chi Minh City Dr.
Tran Van Hai Trieu

Faculty of Information Systems
Chapter 1
Overview of E-payment System

University of Information Technology – Vietnam National University, Ho Chi Minh City Dr. Tran Van Hai Trieu
Learning objectives
• Concepts of E-payment.
• Constituted Components of E-payment
• Benefits and Limitations of E-payment.
• Classification of E-payment’s forms.
• Development trend of E-payment in Vietnam.
What is E-payment?
• E-payments are an electronic or digital way of
transferring funds. Essentially, you can utilize
electronic payment methods to transfer funds as
an alternative to cash payments.
• The various types of e-payment include credit and
debit cards, mobile wallets, internet and mobile
banking, and many more.
• We simply require a bank account and an internet-
enabled device to leverage e-payment solutions
and pay for various products and services.
Source: https://www.dbs.com
What is E-payment? (Cont.)

• Some key interesting issues of E-payment
✓ E-payments require the transfer of funds through
electronic or digital mediums.
✓ We can choose from different e-payment methods
like mobile wallets, bank cards, mobile banking, etc.
✓ E-payments are quick and efficient, and the fund
transfer typically takes place instantly.
✓ It is a secure mode of making payments.
✓ E-payments eliminate the need for cash payments,
and funds are transferred directly into mobile wallets
or bank accounts linked to the mobile number.
Source: https://www.dbs.com/
Constituted Components of E-payment

• Participated parties in E-payment
Constituted Components of E-payment

• Means of E-payment
Advantages of E-payment
• General benefits
✓ Complete and develop e-commerce.
✓ Modernize the payment system.
✓ Warrant benefits for participating parties and minimize
payment risks.
• Benefits of enterprise
✓ Easily monitor, control, and manage cash flow.
✓ Create professionalism for business activities.
✓ Reach new audiences.
✓ Maintain customers.
✓ Reduces a large source of payment documents.
Advantages of E-payment (Cont.)

• Benefits of customer
✓ Customers can make a transaction faster and more
conveniently.
✓ Save costs and time.
✓ Safety and information security.
✓ Allow clients to access the global market.

Limitations of E-payment
• Limitations
✓ Consumption habits of people are cash.
✓ The legal corridor on e-commerce is still vague and not
specific.
✓ Technological infrastructure and human resources
require the safety of privacy systems and automatic
payment systems at a sufficiently high level of
development.
✓ The information's risk will be stolen.
✓ The risk of losing money happens in the case of system
failure.
Classification of E-payment’s forms

• There are six most commonly used forms of E-
payment in Vietnam as follows:
✓ Payment via card
✓ Payment by E-wallet
✓ Payment by smartphone
✓ Payment via
E-payment gateways
✓ Payment by online cheque
✓ Payment via bank transfer
Source: https://m.antoanthongtin.vn
Classification of E-payment’s forms (Cont.)

• Payment via card
✓ Two main types of card payment methods
➢ Domestic debit card
❖ A domestic debit card is a card within the scope of
use in the country.
❖ The card is linked to the user's bank account.
❖ Users need to deposit money into their bank
account for card usage.

• Payment via card
✓ Two main types of card payment methods
➢ Credit card and international debit card
❖ A credit card is a card that lets you buy something
now and pay for it later.
❑ The bank will grant a certain credit limit to the
cardholder for spending as required.
❑ The cardholder must repay the used amount
within the payment period, otherwise, interest
will be charged.
❖ An international debit card is like the role of a
domestic debit card, but it applies to the scope of
global.

• Payment by E-wallet
✓ An E-wallet is understood as an
online account used to transfer,
receive money, or pay for any
normal transactions of the
account holder, such as buying
phone cards, movie tickets, and
other similar things.
✓ To use an E-wallet, users must

have a smartphone with an
integrated e-wallet app and a
bank connection to be able to
make online payments.

• Payment by smartphone
✓ Users may not need to carry cash and can still easily
and quickly pay when shopping or using services with a
phone having mobile payment settings.
✓ The mobile payment system is built with links between
service providers, including banks, telecommunications
providers, consumer systems, and consumers.

• Payment via E-payment
gateway
✓ An E-payment gateway is an
intermediary software system
that connects buyers and sellers
through banks to support and
make invoice payments.
✓ E-payment gateways are
developed by software suppliers
with high security and safety
features. They help payments
on e-commerce sites that take
place quickly and conveniently.

• Payment by online cheque
✓ An online cheque is a payment
form that allows users to pay
via the Internet instead of using
paper cheques.
✓ After the bank checks the
validity of the cheque, it will
transfer the money to the
payment recipient.
✓ The entire payment process is
done online, which saves time
and money compared to paper
cheques.

• Payment via bank transfer
✓ Payment via bank transfer is made through an ATM or
direct transactions on a computer or phone.
✓ Based on this E-payment method, the buyer only needs

to transfer money from his account to the seller's
account to pay immediately when making the
transaction.
Development trend of E-payment in Vietnam

• According to Consumer Payment Attitude's study of
Visa organization in 2022, the proportion of
Vietnamese users using card or E-wallet payments
had increased across all age groups compared to
2021.
✓ There were 66% of users paid for online cards, and 70%
paid with E-wallets or in the application. The study result
indicated a significant growth compared to 32% in 2021.
✓ Similarly, the rate of payment by QR code increased
dramatically by 61% in 2022 compared to 35% in 2021.
✓ There were 90% of surveyors who had made cashless
payment transactions in 2022 compared to 77% in 2021.
Source: https://tuoitrethudo.com.vn
Development trend of E-payment

in Vietnam (Cont.)
• Statistical result of the study
Source: https://tuoitrethudo.com.vn

in Vietnam (Cont.)
• Digital payment in Vietnam
✓ Total transaction value in the Digital Payments
market is projected to reach USD 23.99 billions in
2023.
✓ Total transaction value is expected to show an
annual growth rate (CAGR 2023-2027) of 14.82%
resulting in a projected total amount of USD 41.69
billions by 2027.
✓ The largest market is Digital Commerce with a
projected total transaction value of USD 20.96
billions in 2023.
Source: https://www.statista.com

in Vietnam (Cont.)
• Digital payment in Vietnam – Transaction value

in Vietnam (Cont.)
• Digital payment in Vietnam – Number of users

in Vietnam (Cont.)
• Vietnamese E-wallet market
Source: https://www.vietdata.vn

in Vietnam (Cont.)

in Vietnam (Cont.)

in Global
• Cardless transaction volume
Source: https://www.pwc.com

in Global (Cont.)
• Global payments revenues
Source: www.mckinsey.com

in Global (Cont.)
• Payment revenues per capita and per transaction
vary markedly by country

in Global (Cont.)
• Asia–Pacific accounts for over half of global
payments revenues
Security in E-payment
• Payment security is one of the most crucial issues
of e-commerce. Account thefts and payment
frauds are increasing in online trading platforms.
• Therefore, the issue of
safety and security has
become the top
concern of customers
and an urgent
requirement for e-
commerce and retail
enterprises.
Solution for Security in E-payment
• Cooperate with an online • Https protocol

payment organization • Secure Electronic
• Monitor suspicious Transactions (SET)
transactions Standard
• Address validation for • Payment Card Industry
every transaction Data Security Standard
(PCI DSS)
• Encryption for Payment
Security • Login screen with
secure
• Secure payments using
SSL Protocol • E-signature
In conclusion
• What is E-payment?
• Constituted Components of E-
payment
• Advantages of E-payment
• Limitations of E-payment
• Classification of E-payment’s forms
• Development trend of E-payment in
Vietnam Understand
• Development trend of E-payment in
Global
• Security in E-payment
• Solution for Security in E-payment
THANK YOU
FOR YOUR ATTENTION
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University of Information Technology – Vietnam National University, Ho Chi Minh City Dr.

Tran Van Hai Trieu

Overview of E-payment System

What is E-payment? (Cont.)

Constituted Components of E-payment

Constituted Components of E-payment

Advantages of E-payment (Cont.)

✓ Save costs and time.

✓ Safety and information security.

✓ Allow clients to access the global market.

Classification of E-payment’s forms

Classification of E-payment’s forms (Cont.)

Classification of E-payment’s forms (Cont.)

Classification of E-payment’s forms (Cont.)

✓ To use an E-wallet, users must

Classification of E-payment’s forms (Cont.)

Classification of E-payment’s forms (Cont.)

Classification of E-payment’s forms (Cont.)

Classification of E-payment’s forms (Cont.)

✓ Based on this E-payment method, the buyer only needs

Development trend of E-payment in Vietnam

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Development trend of E-payment

Solution for Security in E-payment

• Cooperate with an online • Https protocol

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