E commerce Assignment
SET & EDI
Submitted To: Submitted By:
Mrs S Aruna Shubham Tyagi RA1511002010694
SET stands for Secure Electronic Transaction and can be explained as a communications protocol standard which is used to secure our credit card transactions over networks like the Internet. SET is not only a payment system, but also it is known as a set of security protocols and formats that enable users to employ the existing credit card payment infrastructure on an open network in a secure trend. SET is used to ensure the security of financial transactions on the Internet. Earlier it was supported by Mastercard, Visa, Microsoft, Netscape etc.
Some key features of the SET are:
Confidentiality of information
Integrity of data
Cardholder account authentication
Cardholders and merchants both must have their registeration done with CA (certificate authority) first, before they buy or sell on the Internet. Once registration is done, the former can start to do transactions.
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It consists of 9 basic steps in this protocol.
Customer search on the website and take the decision to purchase
Customer sends payment and order based information, that has two parts in 1 message:
Purchase Order – for merchant
Card Information – for merchant’s bank .
Merchant sends the card information to their bank
Merchant’s bank crosschecks with Issuer for payment authorization.
Issuer transfer authorization to Merchant’s bank.
Merchant’s bank send authorization to merchant.
Merchant when completes the order , sends confirmation to the customer.
Merchant grabs the transaction from their bank.
Issuer prints credit card bill to customer.
(1.) The customer opens an account with a card issuer.
It can be Visa ,MasterCard etc.
(2.) The customer receives a X.509 V3 certificate which signed by a bank.
(3.) A merchant who accepts a certain brand of card must possess 2 X.509 V3 certificates.
-One for signing & one for key exchange.
(4.) The customer places an order for a product or service through a merchant.
)For verification, the merchant sends a certificate.
) The customer sends order and payment information to the merchant.
) The merchant requests payment authorization from the payment gateway prior to shipment.
) The merchant confirms order to the customer.
) The merchant provide the goods and service to the customer.
(10.) The merchant requests payment from the payment gateway.
Technological aspects of SET:
) Integrity of data
) Cardholder account authentication
) Merchant authentication
An important method introduced in SET is the dual signature. The main objective of the dual signature is to link 2 messages that are intended for two different recipients. For that, the customer has to send the order information to the merchant and the payment information to the bank.
The operation for dual signature :(a.) Take the hash (SHA-1) of the payment and order information.
(b.) These 2 hash values are concatenated and then we get the hashed result .(c.) Customer encrypts the final hash with a private key that creats the dual signature.
EDI stands for Electronic Data Interchange.It is called the electronic interchange of business information using a standard format. It is a process which makes one company to send information to another company by means of electronic.
By using EDI, many business documents can be exchanged. The two most common are the purchase orders and invoices. It replaces the mail preparation and handling associated with traditional business communication. Apparently, the advantage of EDI is that it standardizes the information communicated in business documents, which makes possible a paperless exchange.
EDI semantic layer :(a.) Elaborates the business application
(b.) Procurement example
EDI in Action Information flow without EDI:
Information flow – EDI:
EDI applications in business:
1. International or cross-border trade
2. Electronic funds transfer(EFT).3. Health care EDI for insurance claims processing
4. Manufacturing & retail procurement