financial-service companies, Electronic Data Interchange (EDI) networks, manufacturers, and distributors.
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1. Consumer:
The catalyst for electronic commerce. Mouse-clicks by a home shopper can send orders that energize companies at all ends of our domestic and international economies.
2. Retailer:
The point of contact for consumers, banks and financial organizations, distributors, manufacturers, and suppliers.
3. Credit-card companies:
They help merchants verify credit cards at the point of sale and collect reimbursements later. This is usually done over dedicated networks, which can handle almost any currency and work with a variety of banks across the globe.
4. Banks/financial-services companies:
An interbank clearinghouse coordinates financial transfers between banks. U.S. banks use the Automated Clearing House (ACH). Local banks register payments in a database, which are then exchanged overnight.
5. EDI service companies:
Most EDI transaction
s still use dedicated lines or value-added networks (VANs) run by commercial services. However, EDI also could work over the Internet.
6. VANs:
Special-purpose networks for electronic commerce using EDI or credit-card transactions. VANs might connect with Virtual Private Networks (VPNs) across the Internet.
7. VPNs:
For transactions among parties in the same organization or with companies that have continuous relationships, such as distributors
(8)
, manufacturers
(9)
, and materials suppliers
(10)
. VPNs can be direct private links among divisions and companies, or you can create one via a special Internet connection with an encryption tunnel. Network administrators sometimes build these tunnels by integrating encryption schemes into bridging, routing, or modem hardware.
11. Internet:
The common denominator for electric-money transactions among consumers, retailers, and supplier
s.
The Money Pipeline
