Modern Modes of Business: Transaction Process and Precautions for Security

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Transaction Process

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The prospective customer has to find an appropriate vender by using various web sites, either directly or through a search engine.


  • The vender has been found and goods are identified, the customer makes contact and negotiates the terms

  • Registration form to have an account with a password

  • He can place the order for the items

  • Put by him in his virtual shopping cart


  • The normal way for paying on-line purchases is by the credit card.

  • The customer enters the credit card numbers, expiry date and billing address on the order form, and the vendor can verify the details

  • Debit cards, or store’s value cards can also be used for the purpose.


The payment is made or is assured, the vendor arranges for delivery of goods as per instructions of the buyer.

After Sales Service

  • In any transaction, there can be problems like damaged or faulty goods.

  • For items such as machinery or consumer durables, there can be a provision of warranty or maintenance.

  • The e-Vendors have to make the necessary arrangements for attending to such complaints and services.

Precautions for Security

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  • In on-line shopping, one has to register with the on-line vendor to have an account with him.

  • This provides for a password to avoid login by an unauthorized person.


  • Sender of the message must be identified precisely using the off-line validation, if necessary.

  • This avoids any possibility of fraud or misuse of the password.


  • It refers to the conversion of data into a code so that it cannot be read by other users.

  • The data is converted into the code by the sender and then decoded by the receiver

  • The other alternative is the private (secret) key system.

Digital Signatures

  • A digital signature may be used to authenticate.

  • The digital signature is considered very secure provided

Trusted Third Parties

Another way to ensure security is to transmit a copy of the transaction to a third party trusted by both sides

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