What is E-Business - Mithun Jadhav | Connecting
QUESTIONS FOR E-BUSINESS & Enterprise Planning System (EPS)Contents TOC \o "1-3" \h \z \u 1.What is E-Business ? PAGEREF _Toc243414804 \h 22.Different ways to do or can do Business PAGEREF _Toc243414805 \h 23.Is india mature for E-Commerce ? PAGEREF _Toc243414806 \h 54.What is Business Model ? PAGEREF _Toc243414807 \h 65.What is Revenue model ? PAGEREF _Toc243414808 \h 76.How Payment gateway works ? PAGEREF _Toc243414809 \h 87.What is ERP PAGEREF _Toc243414810 \h 148.Explain the advantages and disadvantages of ERP in brief PAGEREF _Toc243414811 \h 159.Explain ETVX criteria ? PAGEREF _Toc243414812 \h 1610.What are the steps of data migration for successful ERP implementations? PAGEREF _Toc243414813 \h 1711.Additional Reading PAGEREF _Toc243414814 \h 1912.Pointers (Keywords) PAGEREF _Toc243414815 \h 22Note: In order to build flow in the writeup, I have included my understanding in between the pointers from Prasad’s notes and audio recording of Prof Anuj’s sessions. I have tried to mark external references, if any, in between the answers so that you are able to correct unintentional mistakes committed in my writeup. Have put up additional reading section in order to keep the pointers which were not used in any answers as well as whatever I could find worthwhile from netWhat is E-Business ? (Source: Prasad’s notes & Audio recordings.)eBusiness Definition: Exchange of Goods and/or Service over electronic medium. eBusiness shifts business towards digitalization. The objective here is to use internet as the medium as was the case in the first phase. In the new wave, key will be application of Cloud for conducting eBusiness. Salient features of eBusiness: eBusiness has not contributed to GDP.New jobs were created in the first phase of IT Revolution. eBusiness, in its first avtaar, didn’t attain its true potential as it was only mapping rudimentary traditional models into online mechanism.In the new revolution, it is cannibalizing on existing jobs and business by getting rid of intermediate layers. It therefore is changing the way Business is done. For example, Amazon has taken away business of book shops.The need for eBusiness: Working with people is very difficult. They don’t follow standards, rules and policies. Government policies are not very conducive either. Business world is begging for cost while common may is begging for survival. Government which is largest employer contributes virtually zero to GDP. The answer lies in application of Technology which will change the way business is done. Example given is of Google which tracks your location and recommends you choices as per the time of the day in addition to reminding you of events scheduled by you in your calendar.Penetration of Internet through Mobile devices have increased interest in building mobile based eBusiness solutionsDifferent ways to do or can do BusinessEvery business needs a business model and revenue model for it to succeed. It is essential to understand that no business can do everything or meet all requirements. It is important for entrepreneurs to work out the segments and functions in which they would like to operate, apply business model to it, test it against the revenue model and then decide which of the needs can their business meet effectively. For example, when colorplus is to decide whether to launch red colored trousers or jeans for a college crowd, the idea could be tested through following business model.Type of Business# PersonsCapitalLocationClientsTarget AudienceResources (Skills/Technology)Alliances (Agents/Franchise)SeasonalCompetitorOutsourcingTargeting kids, teens, young crowd in metrosLargeMetro citiesMiddle class & fashion freaksKids, Teens, Young crowdGood quality fabric production, different shades/dyes of redAdvertisement, Own shops, FranchiseeSummerLevis, To Jabong, Flipkart etcTarget rural mass through advertisement & brand endorsementLargeTownsRural class, middle class, upper classYoung crowdsAcceptable quality with lower costLocal shops, promotions through posters, tv advertisementsSummer, WinterLocal shops, promotionsLegal StatusSole proprietorPartnershipPrivate LimitedLargeOperating ModelAgencies : LICMultilevel marketing : AmwayStrategic Business ModelB2BB2CC2CC2BThis sheet would then be assessed against the Revenue model which is estimated through following stepsDemand estimation through public surveyPotential sales estimateCost estimation & Comparative analysisCost depends on factors like volume and market. Only when profit is estimated [ (Selling Price – Cost) X No. of units ] the activities is given a go-ahead.Also refer [WaysToDoBusiness.xls] Is india mature for E-Commerce ?India definitely has seen emergence of eCommerce/eBusiness in last decade through success of Flipkart, Snapdeal, Jabong, IRCTC etc. However, the maturity is still debatable. This needs to be understood in multiple perspectives. Am listing the critical ones hereMarket readinessIndian market in urban sector is very much geared up for conducting business online. B2B transactions are happening very much online except for movement of raw material and/or finished goods. Similarly B2C transactions are also picking up with Internet Devices (such as Computers, Mobiles, Smart TVs etc) wherein exchange is happening digitally except for the final delivery of the goods and/or services which still is happening offline. Government policiesGovernment while is enabling technologies though through regulated medium, however is not helping business sector by bringing in imbalance through inappropriate labour laws and economic policies. The recent declaration of food security bill has put tremendous burden on business sector which was already reeling under pressures of meeting labour demands. While eBusiness is helping Business world in eliminating middle layers and connect directly with consumers, it still relies upon people to the extent of their role in manufacturing or product/service delivery. InfrastructureInfrastructure is available in terms of Information highway readiness and ERP systems to serve as back-end to eBusiness. Physical infrastructure and resources are still limited. eBusiness will meets its true potential the day the dependency on physical resources is reduced to nil and entire solution space is delivered on technology platform in entirety.Security IssuesThere have been too many cyber attacks with the latest incident reported of Mr Sanjay Dhande, member in-charge of cyber-security (ref: ) wherein 19 lakhs rupees were withdrawn from his account wherein hacker even intercepted his cell network preventing any notification to reach his cell phone. This latest attack has raised doubts on ability of 2-factor (or multi-factor) authentication in protecting from such crimes. In other words, security by no means is a responsibility of one entity any longer in this connected world. India is still growing through these experiences, constraints and opportunities before it matures completely in the eBusiness space.What is Business Model ? The essence here is for Strategic Business Model which also was part of the excel sheet matrix. Strategy that a company employs to go to market to establish itself, become a leader or eliminate competition. Strategy (as defined by Michael Porter) is the creation of a unique and valuable position, involving a different set of activitiesServing few needs of many customersServing broad needs of few customersServing broad needs of many customersStrategy requires one to make trade-offs in order to select the best choice in the given circumstances. Business is more of quantitative and gives psychological advantage as well that reflects into its numbers. We will discuss some of the strategic business model adopted by companies in past. Nirma vs HULHUL through surf had established itself as market leader in the detergent segment. Instead of taking HUL head-on on the quality, Nirma played the price game. They launched detergent which had an acceptable quality but at a drastically lower price. They not only established themselves into the low price segment but also ended up reducing market share of HUL. Cherry vs Kiwi shoe polishCherry placed itself as a premier segment product even though fundamentally it has same composition as that of other shoe polish.Kelloggs launched its corn flakes product at 60% discount in japan and gave free to schools for breakfast for more than three years. By the time, children passed out of school they got used to Kelloggs as breakfast cereal. In this example, having deep pocket enabled Kelloggs to go with this strategy and establish itself in Japanese market in gradual manner. On the contrary, if the Kelloggs would have tried to launch without any such strategy, quite possibly it would have failed to survive in that market. Also there is change in the way Business are conducted with penetration of internet through IPV4 and IPV6. We now live in a connected world with Internet of Things. It is like having a bread basket which is connected to Internet. Through internet technology will replenish the basket as the items are picked from it.IPV6 will connect all kinds of devices such as TV etc. Computers will not longer be required for consumers to seek services from eBusiness. Hence the spread of eBusiness will grow beyond the computer age. EDI – Specialized avtar / superior form of E-Commerce because security is a big issue with e-commerce. EDI has standardization and creates a virtual net. Information highway is the new way of doing business. Currently it is location independent and soon will become person independent. You might decide to have your own robot doing and sitting the tasks while you will be taking strategic decision. eBusiness is fabuolous way of doing business using someone elses resources and services. Differentiator will be how your organization implements strategic business model. One can also collaborate with other players. Also the markets are no longer local and one can tap into any geography now. In last two decades, the Geo-political map is as follows:China – known as Manufacturing hubIndia – known for its IT talentUS / UK – known for Financial strengthEurope / Middle east – typically the Consumer spaceS.E.Asia – Knownd for affordable LabourAs the purchasing power has improved, there’s rise of Irrational behavior among consumers which allows Businesses to exploit the psychology of consumers:Example would be buying of Samsung S4 @ Rs.38000/- at an average life of 2 years against which consumers might walk down daily rather than catching a Bus / Cab to save that much of money for an year or two. Consumers have even bought TVS scooters only because Tendulkar became brand ambassador for it for a limited period of time. Though it might look illogical and unreasonable on behalf of consumer space, this is a well known tool up for exploits by Business community. Strategic Business model is derived from considerations of such factors in consumer behavior pattern and the financial strength of the business house.What is Revenue model ?Revenue model is worked out through following stepsDemand estimation through public surveyPotential sales estimateCost estimation & Comparative analysisDemand estimation can be done using following:Survey or Past DataWhere to be soldWhom to be soldThis will help in estimating Potential sales (#). Next would be to derive Cost Estimation & perform Comparative analysis with existing benchmark, if any. Competitve prices are the benchmark. Cost depends on factors like volume, market Eg. Orange selling at churchgate stationWhat price will a orange cost me at the sales, not at purchaseIf I order 20 oranges – it will cost 6 Rs.If I order 30 oranges – it will cost 5 Rs.For each incremental rs. What is the decrease in my price… this marginal utility curve will show me the profit maximization or we have Sales maximizationAfter the base for revenue – we need to find a way to make the revenue model work with a viable Business Strategies. But it must be noted that there is Revenue Model are not permanent. One can alter the revenue, business as well as the delivery model in E-Commerce.Eg.: 1) Vegetable market in Vile Parle (W) VS Vile Parle (E). Initially West market was in demand. After the skywalk repairing etc, the JVPD customers were unable to enter the road through car. So the demand decreased, which made a massive crisis in West.How Payment gateway works ?A Payment Gateway is an application that facilitates transaction of purchases over internet. It uses Internet as the communication medium for this activity to happen. A Customer selects to purchase over internet with a credit, debit card or netbanking.The Internet browser uses Secure Socket layer and encrypts the information being sent by user, generates session and forwards user to payment gateway service page where user fills up credentials required for making payment.Payment Gateway in turn sends this information to the Card Associations ( VISA, MASTER etc).The Card association forwards the information to the bank that issued the card.The Bank checks if there are sufficient funds in the card and sends an authorization code to the Card association.This code confirms to the payment processor to process if there are funds in the card or decline if they are not with proper reasons.The payment processor sends this authorization code to the payment Gateway.Payment Gateway then sends the code to the Business to process or decline the payment.Finally the Business or website takes the action accordingly and sends receipts to the customer. Customers & RBI’s perspective Following provisions are must to ensure minimum security levels for electronic payments requiring payment gateways. Example taken here is from RuPay services enabled by NPCI (Ref: )Customers will be authenticated by their issuing bank using methods like OTP (One Time Password)/net banking credentials or challenge questions etc. or any other parameters defined by the issuer bank for the first successful transaction. The customer will have to complete one successful transaction to be registered.Customer will have to select an image and enter a phrase to register his RuPay card for online usage during his first transaction on e-merchants website.In subsequent transactions, the customer will have to identify the correct registered image in order to get primary validation and acknowledge the phrase along with last three online transactions. This is an anti-phishing measure.Subsequently the image and phrase become level one validating factors (please note there validations only permit customer access to PIN Pad page and is not considered for final transaction authorisation). In case the customer forgets or exceeds the number of attempts for image selection they will need to wait till next business day for card to be unblocked or re-register to enter new phrase and select a new image.Customer is required to use a valid ATM PIN for authorization of the e-Commerce transactions. Customer will have to enter PIN on the “bank themed” (Look of the page will be exactly similar to the physical card used by the customer) scrambling PIN pad using mouse clicks only. The PIN pad will shuffle each time a digit is entered. This is an additional security measure.The customer will now be notified about the successful transaction on submitting a valid PIN.From the eBusiness perspective, Business owner has to consider following criteria in mind before selecting payment gateway integration (Source: )1) Paperwork required to setup the account: It may seem daunting at first, but is not an issue normally with EBS/CCAvenue. They ask for an agreement to be printed and signed on a stamp paper to be sent to them. They will provide you with the agreement.2) Setup Fee – Payment gateways charge an initial amount that can range from Rs. 5000 to Rs. 40000. They also charge an annual maintenance fee that is deducted from your account each year.3) TDR Rate – This is the amount that is deducted from each transaction, and can vary for credit cards/debit cards and net banking transactions. Some payment gateways charge more for American Express (or any other card/bank).4) Site Integration – Check what options/environment is available (Java only or ActiveX as well)? Which language is used and is support.5) Transaction failure – One can refer the transaction failure cases reported on IRCTC website. This is important as this can lead to revenue loss, and customers may go to the competitor..6) Cancellation –For some payment gateways, fee is not charged for credit cards, but full fee is charged for debit card, net banking even if you cancel a transaction. 7) Chargebacks – Check what the policy is on chargebacks. It seems third party Payment Gateways do not want to confront the banks, and end up favoring the customer even when customer is claiming a false chargeback. It is recommended to learn about the hold period for chargeback.8) Fraud alert – Some times unnecessary fraud alerts will lead to order cancellation. Find out how fraud alerts are handled by the gateway, as too much documentation requirement may drive off customers.9) Payments – When and how banks payout, via NEFT or cheque and choose the option that works for you. Some banks levy fee for each NEFT or courier charges for the cheque.10) Customer Service –You will definitely need to contact them from time to time to resolve issues related to transactions. Check if they have a toll free number for customer service and how long is the wait time.(Source: )(Source: )The different payment gateways available(Source: )S.No.Gateway NameSetup FeeTransaction% Credit- Debit CardsTransaction% Internet bankingAMC Cost- INRCredit Cards supportBank Support1CCAvenue75007%4%1200Visa,Master Card, Amex,Diners,JCBTotal 43 banks for 10,0006.5%6%2400Visa,Master CardTotal 27 banks for netbanking3ICICI Merchant Service30,0003-4%NilVisa, Master Card4HDFC Bank50,0003.5-6%12000Visa, Master Card5IndiaPay6,0005%3600Visa, Master Card,American Ex, Diners, JCB, DiscoverMajor banks(debit card only)6TransecuteNil5%NilMaster/VisaNone7EPaymentsGlobal9,9907%27008EBS6,0006%6%2400Visa, Master Card, Diners48 Banks ?for Netbanking9PAYSIGNET3000**5%5%150010CellPay15,0004.5%4.5%2500Visa,MasterCard, Cash cardsMajor banks11iPayInNil3.99%3.99%2499Visa20 Banks12PayU60005.4%5.4%2400Visa,MasterCard,Netbanking9 Major banks13HSBC60,0002.75%No support0Visa,MasterCardOnly credit card/debit cards & companies with 2 years existence14Atom20,0003%3%5000Visa,MasterCard,AMEX,Diners,HCB etcSBI,HDFC, ICICI( total 20 banks)15CitibankOnly for High transactions( > Rs. 50 lacs)Only Diners/Master/Visa Credit & Debit CardsNone16Bank of Baroda15,0004%-2500Visa, MastercardNot supported17WhizPay300003.5%3.5%Visa,MasterCardMajor banks19ABCPayments10,0007%7%NilMaster Card,Visa,DinersICICI, Citibank, HDFC, Axis, IndusInd, IDBI20TechProcess Solutions Ltd30,0002.5%2.5%Rs. 5000Master Card,Visa,Diners27 banksWhat is ERP(Source: Pointers from Prasad, Audio lecture & PPT content)Motive here is to build an Intelligent Enterprise through application of ERP. Intelligent enterprise follows processes, keep a check and do not take rash decisions. Enterprise takes informed decisions enabled by reports/data from MIS which senses from environment, interprets and provides information. It empowers Entrepreneur to decide from repertoire of available responses, execute decision with speed and intensity. Example would be identifying deviations by supervisor from the regular business process resulting in low production output. MIS would enable Production Manager to question such actions of supervisor and prevent such deviations from happening in future. ERP reflects an Enterprise. An Enterprise is like an intelligent being having aspirations derived from Vision. Vision dictates Mission which in turns evolve Vision further. In other words, Vision and Mission keep evolving each other in an iterative cycle.ERP essentially is a packaged software that was traditionally in client-server form and has now evolved to web-based format. ERP is real time and its main task is to integrate Business Processes. It ties diverse geographies with each other there by creating an enterprise wide database. ERP processes company transactions impacting data in real time and enables transaction processing and planning. ERP enables Business without barriers through its four pillars viz., Business Management, Business Architecture, Business Insight and Business Anywhere. Business Management involves convergence of geographies with embedded capabilities of the Virtualized enterprises. Business Architecture comprises of adaptable business processes resulting in adaptable user experience. Business processes are the heart of any Organization and their adaptability dictates how a business will evolve as the world changes. It also imposes logic on strategy, culture and organization. It improves collaborative productivity. An intelligent ERP will have user driven KPIs, facilitates search based analysis and shall provide with Information on demand thereby improving Business Insight of decision makers. Lastly Business anywhere is enabled through smart engine design of ERP enabling information tracking and delivery over smart devices 24X7. Explain the advantages and disadvantages of ERP in brief(Source: PPT & external content)Advantages (Copied from previous answer)ERP enables Business without barriers through its four pillars viz., Business Management, Business Architecture, Business Insight and Business Anywhere. Business Management involves convergence of geographies with embedded capabilities of the Virtualized enterprises. Business Architecture comprises of adaptable business processes resulting in adaptable user experience. Business processes are the heart of any Organization and their adaptability dictates how a business will evolve as the world changes. It also imposes logic on strategy, culture and organization. It improves collaborative productivity. An intelligent ERP will have user driven KPIs, facilitates search based analysis and shall provide with Information on demand thereby improving Business Insight of decision makers. Lastly Business anywhere is enabled through smart engine design of ERP enabling information tracking and delivery over smart devices 24X7. ERP enforces Processes and eliminates person dependency to large extent thereby maintaining consistent and/or superior performance.DisadvantagesERP product are complex product and have extensive infrastructure requirements in order to achieve its full potential. They have cost overhead and takes lot of time for implementation. ERP implementations fail because analysis is not correct to identify business process mapping or the business processes are not ready. ERP also at times demand Business Process Re-engineering which is recommended by consultants but face resistance from the in-house staff. Also ERP implementation may not work out if entire organisation level commitment is missing. Explain ETVX criteria ?Business Architecture is defined with adaptable business processes which is the heart of Business. ETVX is applied to detail out these business processes for detailing out their functionality as well as integration with other business processes. ETVX stands for Entry, Tasks, Validations and Exit. Entry defines the trigger point or entry point for the process. Tasks lists out the steps to be performed by the computer. They essentially will map to program instructions that will be executed by the computer. Validations are the checks applied in order to ascertain that tasks are not violating and leading process to invalid state. Exit indicates closure/completion of the process. As pre-requisite to ETVX, one needs to list out all the data stores that will be read or updated by the process. In order to understand how a Business process is detailed through ETVX, let us study the example of salary processing function. Salary processing will contain data related to:?Employee records?Their designations and salary structures including basic, allowances, perquisites, awards, deductions?Employee bank account details?Leave Accruals?Allowances List?Deductions List?Perquisites List?Awards List?Pay History?Employee termination details?Bank Code list?Tax scales list?ReportsEntry - ?Date reaching end of month ?Employee resigning from organizationTask -?Get salary structure of employee?Compute basic, allowances, perks etc.?Calculate any pro-rata salary components if applicable for the month?Apply deductions?Calculate TDSIn case employee has left the organization?In addition to basic salary and allowances, encash leaves as per organization's policy?Apply deductions and calculate TDS?Compute full and final settlementValidation - ?Ensure salary calculation is done as per the structure defined for each employee?Check if defined rules have been considered. For e.g. in case a Salesman has made sales greater than Rs. 10L for the month, then he gets 5% commission.?Rules may differ for permanent and contract to hire employees.Exit -?Generate paysilp of the employees?Credit salary to employee's savings bank account?Credit employee's PF account, gratuity, superannuation etc.?Email payslip to employees and update in all systemsWhat are the steps of data migration for successful ERP implementations?ERP implementation would mean defining Business Architecture starting from building of Vision and Mission till the point of Business Process definitions. Vision is typically an unattainable Dream which is also evolved from the gaps and the opportunities arising from them. Vision is the DNA which says how long a company will live. Vision develops over a period of time and is a challenging exercise. Marketing, branding comes from Vision. Vision energies. Vision is the desire. MISSION on the other hand is the action identified in order to attain the Vision. Mission becomes an collective positioning to achieve certain goals. Mission would be detailed out as short term, medium term and long term goals. In essence Mission is tools, technology and process to attain. Mission is realistic and moves gradually towards vision. Vision desires and Mission fulfills. Mission and vision are evolved in iterative process in cycle as you go from vision to mission and sometimes from mission to vision. Nuts and bolts of the organization would be Processes, structures and systems. An organization is connected by Roles. Build structures and map processes to structures. For each role, describe Job Description. This is called Influencing Organization Behavior. Structure is what you need to deliver the vision and the mission. Processes capture business logic. Business logic should remain same irrespective of trade. Technology to be non-coupled as it allows you freedom to exploit whatever you want to shift in future. Then one needs to understand how the system shall work. Is there inventory and manufacturing? Or am I just sourcing and selling? (like jabong). Processes work on structure. Change the structure and processes will collapse. Processes are non coupled to the systems but are coupled to the structure. Structure is aligned to your star (strength area). One pointed star moves from local player to becoming international player. For the process, you use ETVX Criteria to detail out the processes and their integration. Typically an organization will have following processesERP implementation will involve selection of vendor having product capable of supporting these process and customizable/configurable enough to keep Business Processes adaptable. Then identify a cross-functional team and prepare a plan to have the business processes mapped into ERP. For an organization spread across geographies, phase wise deployment of geographic regions through the local users is recommended. Identify the types of transactions permitted against the roles previously identified and the reports that these roles will consume. Finally existing data needs to be migrated and the ERP is rolled out into operation. ERP Integration will enable global consolidation and embed end-to-end capabilities. A strong ERP is what makes Amazon eBusiness successful. Additional ReadingFor payment GatewayGovt of India RoleThe Reserve Bank of India as the central bank of India has been playing developmental role of National Payment systems and has taken several initiatives for Safe, Secure, Sound, Efficient, Accessible and Authorised payment systems in the country.The Board for Regulation and Supervision of Payment and Settlement Systems (BPSS), a sub-committee of the Central Board of the Reserve Bank of India is the highest policy making body on payment systems in the country and empowered for authorising, prescribing policies and setting standards for regulating and supervising all the payment and settlement systems in the country. The Department of Payment and Settlement Systems of the Reserve Bank of India serves as the Secretariat to the Board and executes its directions.In India, the payment and settlement systems are regulated by the Payment and Settlement Systems Act, 2007 (PSS Act) which was legislated in December 2007 and came into effect from August 12, 2008. Reserve Bank has since authorised payment system operators of pre-paid payment instruments, card schemes, cross-border in-bound money transfers, Automated Teller Machine (ATM) networks and centralised clearing arrangements. We shall now discuss how the Electronic payment and payment gateways fit into these scheme of things.Electronic PaymentsThe initiatives taken by RBI in the mid-eighties and early-nineties focused on technology-based solutions for the improvement of the payment and settlement system infrastructure, coupled with the introduction of new payment products by taking advantage of the technological advancements in banks. Electronic Clearing Service (ECS) CreditThe Bank introduced the ECS (Credit) scheme during the 1990s to handle bulk and repetitive payment requirements (like salary, interest, dividend payments) of corporates and other institutions. ECS (Credit) facilitates customer accounts to be credited on the specified value date and is presently available at all major cities in the country.Electronic Clearing Service (ECS) DebitThe ECS (Debit) Scheme was introduced by RBI to provide a faster method of effecting periodic and repetitive collections of utility companies. ECS (Debit) facilitates consumers / subscribers of utility companies to make routine and repetitive payments by ‘mandating’ bank branches to debit their accounts and pass on the money to the companies. This tremendously minimises use of paper instruments apart from improving process efficiency and customer satisfaction. There is no limit as to the minimum or maximum amount of payment. This is also available across major cities in the country.National Electronic Funds Transfer (NEFT) SystemIn November 2005, a more secure system was introduced for facilitating one-to-one funds transfer requirements of individuals / corporates. Available across a longer time window, the NEFT system provides for batch settlements at hourly intervals, thus enabling near real-time transfer of funds. Certain other unique features viz. accepting cash for originating transactions, initiating transfer requests without any minimum or maximum amount limitations, facilitating one-way transfers to Nepal, receiving confirmation of the date / time of credit to the account of the beneficiaries, etc., are available in the system.Real Time Gross Settlement (RTGS) SystemRTGS is a funds transfer systems where transfer of money takes place from one bank to another on a "real time" and on "gross" basis. Settlement in "real time" means payment transaction is not subjected to any waiting period. "Gross settlement" means the transaction is settled on one to one basis without bunching or netting with any other transaction. Once processed, payments are final and irrevocable. This was introduced in in 2004 and settles all inter-bank payments and customer transactions above ` 2 lakh.Pre-paid Payment SystemsPre-paid instruments are payment instruments that facilitate purchase of goods and services against the value stored on these instruments. The value stored on such instruments represents the value paid for by the holders by cash, by debit to a bank account, or by credit card. The pre-paid payment instruments can be issued in the form of smart cards, magnetic stripe cards, internet accounts, internet wallets, mobile accounts, mobile wallets, paper vouchers, etc.Subsequent to the notification of the PSS Act, policy guidelines for issuance and operation of prepaid instruments in India were issued in the public interest to regulate the issue of prepaid payment instruments in the country.The use of pre-paid payment instruments for cross border transactions has not been permitted, except for the payment instruments approved under Foreign Exchange Management Act,1999 (FEMA).Mobile Banking SystemOnly banks which are licensed and supervised in India and have a physical presence in India are permitted to offer mobile banking after obtaining necessary permission from Reserve Bank. The guidelines focus on systems for security and inter-bank transfer arrangements through Reserve Bank's authorized systems. On the technology front the objective is to enable the development of inter-operable standards so as to facilitate funds transfer from one account to any other account in the same or any other bank on a real time basis irrespective of the mobile network a customer has subscribed to.ATMs / Point of Sale (POS) Terminals / Online TransactionsPresently, there are over 61,000 ATMs in India. Savings Bank customers can withdraw cash from any bank terminal up to 5 times in a month without being charged for the same. To address the customer service issues arising out of failed ATM transactions where the customer's account gets debited without actual disbursal of cash, the Reserve Bank has mandated re-crediting of such failed transactions within 12 working day and mandated compensation for delays beyond the stipulated period. Furthermore, a standardised template has been prescribed for displaying at all ATM locations to facilitate lodging of complaints by customers.There are over five lakh POS terminals in the country, which enable customers to make payments for purchases of goods and services by means of credit/debit cards. To facilitate customer convenience the Bank has also permitted cash withdrawal using debit cards issued by the banks at PoS terminals.The PoS for accepting card payments also include online payment gateways. This facility is used for enabling online payments for goods and services. The online payment are enabled through own payment gateways or third party service providers called intermediaries. In payment transactions involving intermediaries, these intermediaries act as the initial recipient of payments and distribute the payment to merchants. In such transactions, the customers are exposed to the uncertainty of payment as most merchants treat the payments as final on receipt from the intermediaries. In this regard safeguard the interests of customers and to ensure that the payments made by them using Electronic/Online Payment modes are duly accounted for by intermediaries receiving such payments, directions were issued in November 2009. Directions require that the funds received from customers for such transactions need to be maintained in an internal account of a bank and the intermediary should not have access to the same.Further, to reduce the risks arising out of the use of credit/debit cards over internet/IVR (technically referred to as card not present (CNP) transactions), Reserve Bank mandated that all CNP transactions should be additionally authenticated based on information not available on the card and an online alert should be sent to the cardholders for such transactions. Pointers (Keywords)eBusiness: Exchange of Goods AND/OR Service over electronic medium.Irrational behavior drives market (purchase of house, high-end smart phones) Business Model consists of 1) Type of Business, 2) Legal Status, 3) Operating Model, 4) Strategic Business Model, 5) # of Persons, 6) Capital, 7) Location, 8) Clients, 9) Target Audience, 10) Resources (Skills/Technology), 11) Alliances, 12) Seasonal (Frequency), 13) Competitors and 14) OutsourcingOrganization: A structure of defined process manned by people with defined responsibilities to achieve goalBusiness ArchitectureGood GovernanceEntry Task Validation eXit (ETVX)Vision desires and Mission fulfillsStructure delivers mission and visionProcesses capture business logic. Non-coupled to systems, coupled to structures. Profit is never a goal, it’s a by product of a Business model.Profit is the output of the aspirations one has at work. ................
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