Payment in E-commerce / M-commerce

Payment is one of the most important aspects of E-commerce as well as M-commerce. In traditional payment method, one does the payment using cash, cheque or credit card. Electronic payment systems are becoming more important to the online business processes as companies are looking for different ways to serve the customers faster and at low cost. Electronic payment is a financial exchange that takes place online between the buyer and the seller. These are various payment options available for payment in the market today.

The different types of electronic payment systems used are:

Payment Cards
The payment cards can be classified as Credit cards, Debit cards and Smart cards, generally businesses use the term payment card for all types of plastic cards that consumers use to make payments.
Credit Card
This is one of the most popular and widely accepted methods of payment on Internet.
A credit card is issued to the customers by the banks known as issuing banks.
The issuing banks provide the credit cards of the financial institutions which are established and reputed in the services of credit card business.
Examples include MasterCard® or Visa®.
Depending upon the customer’s credit history and income level, credit limits are provided and up to that limit the customer can spend and pay to the issuing bank within the billing period.
As credit cards are linked to a bank account, when they are used to pay online, the merchant charges the goods to the issuing bank account and the bank shows the debit in the next statement. The customer simply pays the bank.
For accepting payments on websites through credit card, merchant needs to open a merchant account with the banks which is known as acquiring banks, which in turn provides the services of online authorization and payment processing.
Authorization is the process of verifying whether the card is active; the credit limits are available to make purchase and verifying the other details of the customer like billing information.
Credit cards are widely accepted by merchants and provide assurance to the customer as well as the merchant.
In credit card transactions over the Internet, the customer visits the merchant’s website and selects goods to buy, all the information related to credit card is entered and then this information is transmitted to the merchant electronically. 
In this transaction four parties are involved:

  • Customer with credit card
  • Merchant accepting the credit card
  • Issuing Bank: issues the credit card and guarantees the payment to the merchant. The bank collects the payment from the customer.
  • Acquiring banks: Financial institution that establishes the account with the merchant validates the credit card information of the customer and authorizes sale based on the customer’s credit limit.

Two more entities play role in online payment.

  • These are payment gateways and processors.

Payment gateways are services provided by the third parties like PayPal which connects networks of all the parties involved and enables to perform authorization and payment in secured manner.
Processors are data centers which perform the credit card transactions and settle funds to the merchant.
Processors are connected to the E-commerce website of the merchant through the payment gateway.
The online payment through credit card on Internet is divided into two parts: Authorization and Settlement.
During authorization the following steps are performed:
Customer checkouts, provides credit card information on the E-commerce website, which along with the transaction details (like them detail, date of purchase and others) is transferred to the payment gateway.
The payment gateway passes the information to the processor which contacts the issuing bank for the verification of the information.
After verification, issuing bank sends the status of verification (or transaction result like accepted or rejected) to the processor which in turn passes it to the payment gateway.
Finally, payment gateway sends the result of the transaction to the merchant’s website. If the merchant accepts the transaction then the next step is the settlement during which it transfers the amount from the customer’s account to the merchant’s account.
During the settlement or payment processing the following steps are performed:

  • Merchant sends the transaction request with all the details to the payment gateway which sends to the processor.
  • Processor sends the payment details to the issuing bank of the customer.
  • It also sends the payment details to the acquiring bank where the merchant has an account.
  • The acquiring bank credits the amount to the merchant account. 
  • The issuing bank after including all the charges sends the bill to the customer which he needs to pay within the billing period.
  • Major credit card companies use the Secure Electronic Transfer (SET) security system to make online transactions secure.

The advantages of credit card are:

  • Gives flexibility to the customer as they do not have to carry lot of cash. Customer can pay for goods and services both online and offline.
  • Keeps record of the customer’s purchase through the bank statement.
  • Allows customers to purchase goods even when they do not have the cash available in the bank account.
  • They can settle the cash by the end of the month.

The limitations of credit cards are:

  • They are unsuitable for very small or very large payments. Also, due to security issues, these cards have a limit and cannot be used for excessively large transactions.
  • Customers tend to overspend using credit cards
  • Problems arise in case lost or stolen credit cards.

Debit Cards

  • A debit card looks like credit card but works differently.
  • It is a kind of payment card that transfers fund directly from the consumer’s bank account to the merchant.
  • The amount is immediately deducted from the bank account of the consumer.
  • The debit cards can keep the consumer purchases under a limit and do not allow him to exceed beyond his/her budget.
  • But while using a debit card for a purchase, the consumer should always be aware of his account balance.

Smart Cards

  • Smart cards look just like credit cards but are different as they have a microchip embedded in their surface.
  • A smart card contains user’s private information, such as account information, health insurance information, private keys etc.
  • It can store 100 times more information than the normal cards.
  • They are much safer than the credit or debit cards as the information stored in the smart card is encrypted.
  • Customers can load their card with cash and then use this to pay for goods in a merchant’s retail outlet or website.
  • Card readers are available for retail outlets as well as an attachment for PCs.
  • This convenience gives a great advantage to smart cards.
  • They can be used for a range of purposes like storing digital cash, storing a patient’s medical records etc.
  • Smart cards are popular in countries like U.S., Europe, Japan and some parts of Asia.
  • A smart card reader is required to read information or add data to it.
  • It is a small device into which the smart card is inserted.
  • For example, when one visits their family doctor, the smart card can be given to him to review the medical history and prescribe medicines.
  • This information is also inserted into the smart card.
  • At the medical store, the card can be handed over to the pharmacist, who can see the prescription and give the medicine accordingly. 
  • Also, the payment for the medicines can be done using smart card.

Charge cards

  • A charge card is another form of payment mechanism wherein the customer can pay through the card to the vendor.
  • As compared to credit cards that have a credit limit, the charge card does not carry any spending limit.
  • The customer has to pay the total amount used at the end of the billing period to the company that has issued the card.
  • If the total amount is not paid back then the customer has to pay a late fee.

Net Banking

  • Another option which is becoming more popular is net banking or online banking. It does not involve any type of card.
  • It can be used by customers who have bank accounts enabled with Internet Banking.
  • The bank provides the net banking password to the customer for operating the account from Internet including the payment for online purchases.
  • Many of the E-commerce / M-commerce websites provide the facility to make the payments using net banking.
  • Instead of entering card details on the website, it allows one to specify the bank through which the user wishes to pay from.
  • On these websites, when one proceeds to make the payment, one is asked to select the bank.
  • Once the bank is selected, the screen of the bank’s website will be seen.
  • That is where the login procedure is done using account number and net banking password.
  • The transaction and transfer of the amount can be performed from the users account of the merchant.
  • First, the user has to register with the site and provide the details of the jopurney along with the passenger information.
  • Once the information is filled up, the user can proceed to the payment where net banking option is provided.
  • Selection of bank is done here and continued further which displays the login screen of the bank and transfer fund to Indian railway to complete the booking.
  • After successful payment, the user gets a message on the registered mobile number, which can be shown at the time of travel or E-copy of the ticket can also be printed.
  • Net banking payment system is seen as being safer than using credit cards as nearly all merchant accounts in India offer it as an option.

Electronic Fund Transfer
Electronic Funds Transfer (EFT) means transferring money from one bank account to another electronically.
It is safe, secure, efficient, and less expensive than paper check payments and collections.

Examples of EFT are:

  • Transactions amongst various banks around the world.
  • Payment of tuition fees using an ATM.
  • Deposit of employee’s salaries in their accounts.
  • Monthly bank account deductions and many more.
  • The popularity of EFT for online bill payment is growing.
  • The benefits of EFT include reduced administrative costs, increased efficiency, simplified book keeping and greater security.


  • Most of the time when a purchase is made on the web, the user has to fill out a form with name, shipping address, billing address, credit information and so on. 
  • It becomes an annoyance if the similar form has to be filled up every time the user shops.
  • Some merchants solve the problem by having to fill out a form only once, and then saving the information on their servers for later use.
  • These merchants provide e-wallet for its customers.
  • Today many banks, online grocery stores, telecom services etc, provide e-wallet services.
  • E-Wallet is an electronic card for making secure online payments towards a merchant.
  • It works just like a credit or a debit card.
  • While making payment through E-Wallet the customer is not required to provide the credit / debit card number thus reducing the risk of credit / debit card number being exposed.
  • For example, IRCTC has launched E-Wallet scheme for the customers to make online booking easier.
  • The customers having an account can deposit money in advance with IRCTC which can be used in future as payment option to book the tickets online.
  • Currently the users have to provide the credit / debit card details for booking tickets.This payment procedure takes time as the customer is transferred to the bank’s server for payment.


  • The term RuPay is coined from two terms Rupee and Payment.
  • It is a new card payment mechanism launched by National Payments Corporation of India (NPCI).
  • Currently, as there is no domestic card Indian banks have to tie up with Mastercard or Visa to connect cardholders, merchants and issuing banks around the globe.
  • Mastercard and Visa are the world leaders in card payments and all payment transactions are processed through them.
  • Every transaction done using a credit or debit card issued by a domestic bank is routed through their network switches which are outside the country.
  • These transactions involve additional charges for providing the services.
  • The banks have to pay for processing all debit and credit card payments.
  • RuPay cards are the domestic alternative to the other payment cards.
  • By using RuPay cards, all the transactions will be processed within India.
  • As the transaction processing will be done domestically, the cost of each transaction clearing and settlement will be reduced.
  • RuPay will benefit the customers and the banks by reducing the cost.

Protecting Intellectual Property

Several new and improved methods are continually being developed to protect the intellectual property. Some of them are discussed below:


  • Steganography is the process of hiding information within other information.
  • The information in the files if not protected can be used for any malicious purpose. 
  • It works by replacing unused data in computer files such as images, sound or texct with invisible information.
  • This hidden information can be plain text, cipher text, or even images.
  • Special software is needed for steganography, and there are freeware versions available on Internet which can be easily downloaded.

Digital Watermarking

  • The watermark is a digital code inserted into a digital image, audio or video file which can identify the file’s copyright information.
  • It also allows hiding information in a totally invisible manner.
  • Earlier artists used to creatively sign their paintings with a brush to claim copyright.
  • But in the digital world, artists can watermark their work by hiding their name within the image.
  • Hence, the invisible embedded watermark helps to identify the owner of the work.
  • This concept is also applicable to other media such as digital video and audio.
  • Currently the unauthorized distribution of digital audio over the Internet in the MP3 format is a big problem.
  • In this case, digital watermarking may be useful to set up controlled audio distribution and to provide efficient means of copyright protection.
  • In the field of data security, watermarks can be used for certification and authentication.
  • For example, the photo identity card of a person can be protected by an identity number “123456” written on the card and hidden as a digital watermark in the identity photo.
  • So manipulating or changing the identity photo can be detected easily.
  • Digital watermarking can also link information on the documents.
  • For example, the name of a passport owner is normally printed in clear text.
  • But using digital watermark, the name can also be hidden in the passport photo.
  • If anyone tries to tamper with the passport by replacing the photo it would be possible to detect the change by scanning the passport and verifying the name hidden in the photo.
  • A visible digital watermark can be added to any image using photo editor tools like GIMP.
  • errors while entering a URL.

Legal Issues in E-commerce / M-commerce

  • E-commerce as well as M-commerce presents a world of opportunity for doing businesses, reaching global markets and providing facility of online purchasing. 
  • It provides opportunities to improve the business processes.
  • However, just as any new business has some issues and risks so does E-commerce and M-commerce.
  • Both of these pose many legal challenges, as it is the activity performed on global Internet without national boundaries.
  • Every nation has its own rules and regulations.
  • The major challenges are related to the intellectual property rights, copyrights, privacy and many times the disputes among the parties.
  • The legal framework is necessary to resolve these issues.
  • Many countries have already established their legal framework for electronic commerce.
  • Indian Government has also established the IT laws (Information Technology Laws) under the IT act.
  • Enforcement of legal rules and regulations provides confidence to the customers that their personal information remains secret and will not be misused.
  • If it is misused, responsible party can be punished.
  • This type of security is a must in E-commerce and M-commerce as customers provide their sensitive information like credit card details.
  • Companies making online business are getting legal support in case of misuse of their logos or any copyright materials like digital content.
  • Any dispute between two parties can be resolved under these laws.

Securing Intellectual Property
The intellectual property includes books, software’s, music, video, copyrights, trademarks and web pages. Some of them are explained below:


  • Copyright provides the author with a tool to protect his / her original work from being used or taken by others without permission.
  • It is applicable to books, software programs and articles.
  • Copyright law protects intellectual property in its various forms, and cannot be used freely.
  • It is difficult to protect Intellectual Property in E-commerce or M-commerce.
  • For example, if one buys software, one has the right to use it and not the right to distribute it.
  • The distribution rights are with the copyright holder.
  • Also, most of the web pages are protected by copyright.
  • In that case, copying contents from that website also violates copyright laws.


  • It is a specific logo, mark, word, symbol, design, phrase or image which is used by an individual or a company to distinguish a product or service from that of others in the market.
  • A trademark may be designed by the following symbols: TM, SM and ®.

Domain name disputes

  • The competition over domain names is another legal issue.
  • Earlier, the domain names were given on first come first basis.
  • Thus people would register domain names that were not in use but would be of importance.
  • Later on, such domain names were sold to concerned company at a very high price.
  • This is known as cyber squatting.
  • Another problem is Name changing where someone registers purposely misspelled variations of well known domain names.
  • This can mislead the consumers who generally make typographical errors while entering a URL.

Internet Security measures

To prevent the various security threats many security measures are taken. Some of them are discussed below: 
Antivirus software 
Antivirus software is a computer program that detects, prevents and takes action to remove the malicious codes like viruses, worms and Trojan horses from the infected system. To protect your computer one needs good antivirus software. A system without antivirus software can easily be targeted by malicious code within a short span of time on Internet. The problems and damage that are caused by an infection can be extremely varied. The infection may be simple as causing strange noises, pop-ups and other annoying things on the system. It may delete the files and slow down the system or also can damage the hardware or destroy the entire computer system. Once a system is infected by virus, it will spread by attaching to other programs and files within the system. Viruses not only replicates itself within the system but can also spread to other systems by taking control of the users email and sending out copies of itself to those in the users contacts list.  The most common way a system is attacked is through infected attachments to email. These attachments can be in the form of pictures, videos, sound clips or any other type of file that can be attached to an email. Infections can also spread through downloads. To prevent harm to the system, the antivirus software scans the downloaded files and the entire computer system in order to detect the presence of an infection. Today, there is antivirus software for mobile devices also due to prevalent use of Internet on these devices. A large range of antivirus software is available in the market. Antivirus software is critical to be installed and kept updated regularly on the computer. 
Companies having their own websites have to control the access to the network both inside and outside the company network. The most commonly used network protection barrier between the company’s network and the outside world is a Firewall. A firewall is a device (a computer or a router) placed between the network and the Internet to monitor and control the traffic between the company’s local network and the outside world. The primary goal of a firewall is to keep intruders away from the company’s E-commerce infrastructure. It ensures that the company’s crucial data is kept safe and not accessed by the intruders.  A firewall protects the local network against the following: 
Email services that sometimes create problems. 
Undesirable material like photos, videos entering into local network. 
Unauthorized persons gaining access to local network. 
Unauthorized data or information leaving the company’s network. 
Protects from any type of network attack.  
Digital Certificate 
Digital Certificate or Digital ID is used for providing our identity in electronic transactions. Just as we have a driving license or a passport to prove our identity in the real world, with a digital Certificate, we can assure the business organizations, online services and friends that the electronic information they receive from us are authentic.  Digital Certificate is issued by a trusted third party to establish the identity of the holder. The third party who issued certificates is known as a Certificate Authority (CA). Digital Certificate contains the holder’s name, a serial number, expiration dates, a copy of the certificate holder’s public key which is used for encrypting messages and digital signatures, and the digital signature of the certification authority so that a receiver can verify that the certificate is real. 
Cryptography is an art of protecting the information by transforming it into an unreadable form.  Encryption is the transformation of normal text known as “plain text” into unreadable or secret text known as “cipher text” using encryption algorithm.  A secret key is used to encrypt and decrypt a message. It does not hide the text but converts it into other text that does not make any meaning.  Its purpose is to ensure privacy by keeping the information hidden from anyone on the Internet except the receiver of the message. Messages are encrypted just before they are sent on the Internet or network. When the encrypted message is received by the receiver, it needs to be decrypted. Decryption is the reverse of encryption. It is the transformation of encrypted text back into normal text. There are number of encryption algorithms available in the market today. In recent years, number of cases has been reported where the data in transit was intercepted. Encryption is used to protect data in transit, for example data being transferred via networks like Internet or E-commerce, mobile telephones, Bluetooth devices and bank Automatic Teller Machines (ATMs). 
 When the message is received by the friend, it can be decoded with the help of the key. Anyone else who sees the message in transit will only see weird characters. The key kept here is simple, but usually they are quite long.  For E-commerce security various protocols are also used. Below given is the explanation to understand SSL protocol: 
Secure Socket Layer (SSL)  
Now-a-days every user sends various types of data from email to credit card details. The user would want this data to be protected when in transit over a public network.SSL protocol is used for securing web transactions on the Internet. It was developed by Netscape. During the E-commerce transaction, all the information is exchanged in secured manner using SSL by encrypting all the messages. It also provides the authentication of the merchant or shopper using a digital certificate so that the customer knows that they are communicating with a valid owner. To identify whether a site is secured, a security logo is present on the screen. If a site is secured by VeriSign, then the security logo of VeriSign is displayed on the login screen of the secured site. On clicking, the owner information and the validity of the certificate is displayed. This indicates that the communication with this site is secured and the owner of the website is valid who is certified by the authority like VeriSign. The other indication of the security is that whenever connection is made to the secured site its address starts from https:// rather than http://.

Internet Security Threats

The most common threats that are faced on Internet are:
Malicious code 
Malicious code is one that causes damage to a computer or system. Malicious code can either activate itself or be like a virus requiring a user to perform an action, such as clicking on something or opening an email attachment. It can also affect a network, send messaged through email and steal information or cause even more damage by deleting files. 
A sniffer is a program that uses Internet to record information that passes through a computer or router in transit from sender to receiver. Using a sniffer program is like tapping the telephone wire and recording the conversation. Sniffer programs can read e-mail messages, user login, password and credit card numbers.
Denial of service attack 
A Denial-of-Service (DoS) attack is an attack used to shut down a machine or network, making it inaccessible to tie intended users. By targeting the user’s computer and its network connection, or the sites which the user tries to access, an attacker may be able to prevent the user from accessing email, websites, and online accounts like banking or other services that relay on the affected computer. The users are flooded with hundreds and thousands of messages that create traffic problem on the network. 
Cyber Vandalism 
Cyber vandalism is the electronic defacing of an existing website page. An attacker replaces the website’s original content with his / her own content. It is an example of integrity violation. It is the electronic equivalent of destroying property or placing graffiti on someone’s photograph. Today, there are so many cases of cyber vandalism where the business content is replaced by offensive material. 
Spoofing or masquerading is pretending to be someone you are not, or representing a website as authentic when it is actually a fake. It is technique where the attacker tries to assume the identity of another person or system for transacting the victim site. For example, an attacker can create a fake website as and substitute his IP address for the real website IP address. All the user’s visiting to the real site will then be redirected to the fake website.

Security Issues in E-commerce & M-commerce

Internet is a public network system that consists of thousands of private computer networks connected 
together. These private computer networks are exposed to potential threats from anywhere on the 
public network. Internet provides a good opportunity to the businesses but along with the convenience 
also come new risks. The valuable data or information that travels on the Internet may be misused, 
stolen, corrupted or lost. For example, while making online purchase on the E-commerce website, 
customer needs to provide the credit card number and personal details. This information is transmitted 
to the merchant server. The merchant server sends it to the issuing bank for authorization through 
payment gateway. All these transmissions occur on the public network i.e. Internet.  An unauthorized 
user may read the credit card number during the transmission and misuse it later on. Also, there are 
possibilities that order information might be changes in between. If the customer has ordered 10 items, 
and somehow the merchant receives order of 100 items, he would ask us to pay for 100 items. An 
intruder can steal or tamper information anywhere in the world while sitting on his computer. He can 
create new programs and run them on remote computers causing it to malfunction or break down in 
worst cases while hiding his identity. 
E-commerce / M-commerce sites have to keep their online data such as customer’s personal details, 
their bank details and many more safe. They have to be aeware of all the frauds that are taking place 
now days. As E-commerce deals with payments such as online banking, electronic transactions, using 
debit cards, credit cards and many others; the E-commerce / M-commerce websites have more security 
issues. They are at more risk of being targeted than other normal websites. Thus, it becomes very 
important to secure the data on Internet. 
The E-commerce / M-commerce security must meet four important aspects as mentioned below:
It refers to the secrecy of the information so that unauthorized user cannot read it.
It is achieved by using cryptography in which all the messages transmitted are encrypted and only the 
receiver can read it after decrypting the message using appropriate key. 
This protects the data from private attacks and ensures that the message is not revealed or leaked to 
anyone as it travels to the destination.
It helps in protecting the protecting the confidential data like credit card number.
It ensures that the information must not be accidentally or maliciously altered or tampered in transit. 
The receiver should receive the same message as was sent by the sender. 
If the message is altered in between the transition, it should be detected. 
This removes the problem of modifying the order quantity in between and later creating the payment 
It ensures that only authentic users are allowed to use the system. 
The login and password is one of the ways to achieve authentication.
It ensures that the sender of the message cannot deny that he / she has sent the message. 
It prevents sender or receiver from denying a transmitted message when in fact they did send it.
For example,. If the customer denies of sending a purchase order for any reason, then it can be proved 
that the customer has send the message. It is usually accomplished via digital signatures or a Trusted 
Third Party (TTP).


With more and more wireless handheld devices like PDA’s, Cellular phone and pocket PC’s there are  
significant opportunities for the growth of M-commerce. 
Although mobile commerce enables access to goods and services regardless of the location of buyer or 
seller, in many situations the specific location of the buyer and seller is important to the transaction.
Today various location-specific applications and services are emerging.
These applications track the user’s location in order to deliver a service or product.
The use of technologies which provide the location information for business purposes is known as L-
The technology uses the geographical location of the mobile device to determine which applications are 
appropriate based on that area.
It enables users to log their locations, track the location of another person, and find places such as a 
bank or restaurant.
The technology works by using signals from GPS, cellular and Wi-Fi sources.
The Global Positioning System (GPS) is most accurate in determining a mobile device’s position.
It is based on a worldwide satellite tracking system where the GPS signals are generated by a group of 
satellite that orbits around the Earth.
To locate a point, a mobile device will utilize three satellites to create an intersecting point that locates 
the device within 500 meters.
This is known as triangulation. If the GPS signal is poor, weak or blocked, the mobile device can use 
the signals from cell towers and Wi-Fi hot spots.

These signals do not broadcast their own locations but Smartphone companies use databases that store 
the locations of these sources.
Another example of location based services is where one can use maps to find the path to the 
For example, the user wants to reach a particular destination whose path is not known.
Location based services offers convenience and opportunity to provide services that are more quick or 
precise and can meet a customer’s needs. 
Some examples of location-based applications are:
 1. Information or directory services: dynamic yellow pages automatically inform the users about the nearest restaurants, parking facility, traffic updates. 
2. Tracking services: tracking of assets, locating friends in a geographical location, tracking stolen 
     cars, tracking of children by parents.
3. Emergency services: emergency medical ambulance, search and rescue mission, roadside assistance, 
     police and fire response.
4. Advertising promotion: targeted ads, promotional messages, customer identification in a store.
5. Mapping: Creating maps of specific geographical location.
6. Navigation: plotting route from one place to another. 

Applications of M-commerce

Mobile Marketing and Advertising
Companies, today, are using M-commerce to expand their services from marketing to 
advertisement. Mobile advertising is one of the most popular ways for companies to reach a large 
audience. Advertising on Internet has become a major source of revenue for most of the 
portals. Many retailers are offering location based mobile advertising in order to target consumers 
and increase their sales.
An advertisement placed on the mobile device of the user can thus be made on personal 
requirements and location-specific.
 It can update the users about the various discounts and schemes available in the nearby areas of 
the current location of the user.
Mobile Ticketing
 Users can easily buy tickets for air or rail travels, movies etc. 
The tickets can be sent to the user’s mobile devices. 
 Users can further show these tickets on their mobile devices at the respective place. 
Tickets can also be easily cancelled on the mobile phones using the application or accessing the 
portals of travel agents. 
This helps in reducing the traffic and the parking problems which are increasing day-by-day as the 
user need not travel to the place for buying tickets. 
Mobile Auctions 
The auction sites are becoming more popular these days. 
Mobile devices further help in increasing the reach of these auction sites. 
A user while on the move can access these sites, make a bid, monitor bids and take a timely action 
on the bidding process. 
Many of the auction sites have built gateways and interfaces to provide access to mobile devices 
through wireless networks. 
Mobile Entertainment 
Mobile devices are used extensively for listening to audio, viewing video and playing games. 
The mobile users can subscribe to entertainment libraries where they can search for songs, videos 
or games and easily downloaded them in their device for playing later. 
Entertainment services such as pay-per-download, pay-per-event or on subscription basis can 
cater to a large number of mobile users and are willing to pay for the services.
Mobile Purchase 
Mobile purchase allow customers to shop online anytime anywhere. 
Customers can browse and order products while using a secure payment method. 
Instead of using paper catalogue, retailer can send a list of products that a customer would be 
interested in, directly to their mobile device. 
Alternatively, the consumers can also visit a mobile version of a retailer’s E-commerce site.

Mobile Financial Services 
Today, many popular banks and financial institutions use M-commerce. 
They allow their customers to access account information; perform transactions like stock purchase, remit money, via mobile phones and other mobile equipment's. 
Mobile Information Services 
A wide variety of information services can be delivered to mobile phone users in much the same way as 
it is delivered to personal computers. The services include:
§  News service
§  Stock market data
§  Sports news
§  Financial records
§  Traffic records

§  Traffic information

Benefits & Limitaions of M-Commerce

Mobiles are being used more and more on daily basis and today it is not merely used to make or receive a call. Mobile companies are coming up with new features for their smart phones, which offer consumer ease, flexibility and security at the same time. The ease of availability and faster speed has made M-commerce more popular now days. The Web design and development companies have also optimized the websites, such that it can be viewed correctly on mobile devices. M-commerce is the integration of wireless networks accessed through handheld devices and Internet.
The benefits of Internet and E-commerce are offered by M-commerce also.
Some of the advantages of M-commerce as listed.
  • It provides convenience to the user.
  • In just few clicks on the mobile device, the user can do shopping, banking and download media files while on the move.
  • Mobile device enables the user to be contacted at virtually anytime and anywhere.
  • Reduces transaction cost.
  • Reduces the time to order. The user does not need to be on the PC or laptop to order.
  • Streamline business processes.
  • Provides global reach.
  • Conduct business 24*7.
  • Flexibility of accessing the information through any mobile devices.
  • Payment can be done using the mobile devices itself just the same way as it is done on personal computer.
  • Useful to deliver time critical and emergency information.
  • Easily identifies the physical location of the handheld device. The emergence of location based applications enable the user to receive relevant information.
  • Customized alerts can be easily received on the mobile device.
  • Instant connectivity and availability of faster 3G services has made M-commerce more popular these days.
  • Timely information can reach the user.
  • The information like flight or train schedule, delay or cancellation can be given to the user on his mobile device on real time basis.

Limitations of M-commerce
Though the list of advantages of M-commerce is large it has a number of limitations.
Some of the limitations of M-commerce are listed below:
  • The handheld devices commonly used today offer a limited screen size. This further limits the types of file and data transfer. At times it is difficult to display videos.
  • User interface is less convenient when compared to personal computers.
  • Mobile devices have limited computing power, memory and storage capacity.
  • It operates over wireless networks which are less secured as compared to wired network.
  • It offers a limited bandwidth.
  • High cost of establishing mobile and wireless broadband infrastructure.