The development course of American payment and the alienation of payment difference between China and America

Payment infrastructure construction in the United States





infrastructure is built and maintained by a variety of institutions and organizations.





1. The bank and the Federal Reserve provide paper payment tools notes with cheques. Its liquidation is mainly done by the bank and the US Self-Service clearing House (Automated clearing House,ach).





ach is the most stable and efficient batch Exchange center in the United States, providing interbank remittance, electronic payment and liquidation services to participating depository institutions. Ach supported transactions include: payroll, social welfare, automatic repayment of various loans, business-to-business payments, electronic payments, federal and state tax payments. In 2004, the total volume of ACH processing was 10 billion, with a total volume of 20 trillion USD. Commercial transactions accounted for more than 90% per cent and others were traded by the Government. Because businesses cannot directly connect to the ACH network, ach's billing business is mostly done by participating banks.




The
2.VISA and MasterCard organizations issue debit and credit cards to financial and non-financial institutions in the form of membership. These two card issuers outside the United States and the total number of transactions in the 2000 years after the rapid growth. Visa and MasterCard organizations independently build payment standards, clearing systems, POS or network ATM and risk control systems.





3. Third party independent issuers and clearing houses, such as American Express (Anglo Express). At the end of 2004, American Express had a total of 65 million cards, trading at $420 billion a year. The liquidation of such payment cards is achieved within this body.





4. Payment service providers, such as the first data in the United States. The first data independently constructs the POS, the ATM system and the network, and provides the end user to connect with the issuing bank directly the service and the receipt business, therefore has the certain competition with the Visa and the MasterCard organization. At the same time its Western Union remittances provide offline cash remittance business, it is the world's largest online cash remittance network.





5. Telegraphic transfer business providers, such as swift and the Fed wire, primarily build and link bank account wire transfers. Swift has a very high rate of use in Cross-border wire transfer operations.





6. A bank that provides receipts, such as the United States Wells Faro Bank.





the behind-the-scenes
of American payment development




as a result of long-term development, the United States financial services industry is quite developed, especially the bank card receipts business. As a result, the American enterprise of business E-commerce in the bank card payment has not encountered great resistance. Some of the main reasons are:





a) convenience of online shopping;





b) VISA, MasterCard and Banks have further perfected the credit card refusal rules, so that consumers have a good guarantee of credit card fraud and business fraud;





c) Free online transactions.





but Consumer-to-consumer and C2B transactions are different. A large number of us ebay's personal businesses have found that almost all banks have no access to individual bank card receipts business services, and that other third-party billing services are expensive and do not support docking with U.S. ebay. So most American online auctions are done by personal checks.





but when using cheques, the trading cycle is too long for buyers, and it takes 2-3 weeks for the buyer and seller to complete the transaction. PayPal provides us ebay buyers and sellers with fast, convenient and safe charging tools.





US online Payment supervision





The United States does not specifically regulate online payments, but the existing rules and regulations and the management of online payment business, specifically divided into federal government regulations and State government regulations.





The United States has more than 40 states to implement industry regulation on remittances and most non-bank institutions, such as "Money services business". But the regulatory standards and scope of each state vary greatly, and any peer-to-peer payment business needs to apply for a remittance business license in most states.





America's Patriotic Act, passed after 9.11, has a clear regulatory requirement for all money-service operations (MSB). Any business that operates a currency service must be identified by the FinCEN of the US Treasury before opening.





The supervision and security of stranded funds is partly achieved through deposit extension insurance (pass Through Ping Coverage) provided by the Federal Deposit Insurance Agency (FDIC). Any peer-to-peer online payment service provider who has deposited all its remaining funds in the FDIC-insured commercial Bank, modifies the user's terms of service and satisfies other information disclosure requirements, will be insured at $100,000 per household. But this insurance is only valid when the deposit bank closes, and if the payment service provider itself collapses, deposit extension insurance will not apply. So this program only partially solves the problem of capital security.





The stage difference between China and America





The United States is in the online bank card receipts business development maturity, most banks to provide coverage of all the bank card online billing business. PayPal is a single application value-added service developed on the basis of traditional billing business. The situation in our country is quite different. The phased development of online billing service and online payment value-added service will be shortened to completion in one phase. This determines that China's payment value-added applications will be diverse, rather than single.




The difference
of
stage




American online payments are extended to the Internet media on the basis of well-developed online credit card and ACH construction, based on the premise that credit cards and bank cheques are already the most familiar tools for the vast majority of U.S. users paying offline transactions. Payment authorizations, business processes, liquidation, industry standards, risk control, and high-capacity information systems built under the original system do not require major modifications. Overall, the United States online payment market development in two steps: 1985-1998-year offline payment infrastructure and offline receipts business mature development, from 1998 onwards, the technology extended to the Internet applications and value-added payment application development.





Our country credit system is not perfect, the bank card payment system construction time is short. After the establishment of UnionPay in 2002, the offline billing business developed rapidly. China's internet users have developed billion, while mobile phone users are close to 500 million. In these two platforms the demand for payment is much faster than the whole national payment infrastructure. Therefore, the development of China's payment market will be the basic construction (including the receipt of business) and value-added payment applications at the same time development, two steps and a step.





Market Segmentation and Application Difference





The market segmentation of American Internet industry and application is much bigger than our country, in each application domain, the main business concentrates on 1~2 service provider, the marginal competition between different application providers is less. As most of the U.S. application providers can communicate directly with the receiving agencies, there is little market space for value-added payment providers.





our country is different. There are a number of major providers in any Internet and wireless application area, and the marginalization of service providers in different application areas is evident. This shows that our independent payment providers can not rely on 1~2 applications to support a large number of user groups and transactions. At the same time, because of the strategic transaction data, any non-third party payment provider will face the pressure of competition in the strategic cooperation. Therefore, the value-added payment service of our country pursues the diversification of application support to enlarge the business scale.




Diversity difference of
payment means





American credit cards and cheques are highly popular, and online payments mainly use bank cards and ACH payment platforms.





China's current online transactions and wireless applications in the payment is diversified and relatively high cost, including cash to pay, telegraphic transfer, postal remittance, bank card, point card, mobile generation charges and telecommunications generation fees. The diversity of this means of payment will have a significant impact on the business development and strategy of the payment provider.





Market research company Celent Electronic Support/Pay Research report: The U.S. Electronic payment industry is in a period of rapid growth, the 2003 Internet payment Market size of 8 billion U.S. dollars, to 2005 this figure will reach 12.5 billion U.S. dollars, which, innovative payment services, the composite annual growth rate will reach 55%, The fastest growing area for the electronic payment industry. The market share of electronic cheques will increase from 6% in 2003 to 2005 years of 9%. Meanwhile, market analyst Gwenn Bezard points out that the focus on the micro-payments sector is less than the real opportunity.





at the same time, pay card functions tend to diversify, payroll cards, stored value cards and many other applications to expand the function of debit cards. Celent points out that a group using payroll cards is forming, with about 1000 to 25 million payroll card holders without bank accounts, which will produce 8 billion dollars of consumer and financial services annually. Up to 2006, about 7 million payroll cards will also be issued and users will be extended to middle and high income groups.





Nielsen's report predicts that by 2010, card payments will occupy 46.48% of the U.S. payment market, and vendors and electronic payment systems suppliers will need to support a variety of new products and programs, such as prepaid cards, gift cards, wireless prepaid accounts, etc. Celent points out that the expansion of the US electronic payment market will bring revenue growth to issuers and card networks, but the outlook for the impact of the new CHECK21 bill on financial institutions ' ticket-collection operations is unclear.