Secure Electronic Payments or SET

Daily report of security breaches, extortion, identity theft and general havoc to dog e-commerce and drive away large proportions of the buying public. To partially answer these concerns, the banking associations – Visa and MasterCard – jointly issued Secure Electronic Transactions (SET) as a specification to implement the business services needed for worldwide processing of credit, debit and charge card transactions over open channels like the internet.

SET is an open specification for handling credit card transactions over a network, with emphasis on the Web and Internet. Secure transactions are critical for electronic commerce on the internet.

Merchants must automatically and safely collect and process payment from internet clients, therefore, a secure protocol is required to support the activities of the credit card companies.

SET is also being used to provide the better quality of service. Most business transactions involve the payment and settlement process. Electronic payment systems have become necessary to enable the Internet commerce.

The requirements of payment transactions include confidentiality, security, integrity, non-repudiation and authentication. One of the main bottlenecks in the growth of E-commerce is lack of suitable payment instrument and corresponding electronic payment system.

When a person makes an online purchase on the internet, the credit card information is vulnerable to interception by network sniffers. Software that easily recognizes credit card number formats. In this case, several basic security measures are being used to solve the security problems:
*Encrypt (code and scramble) the data passing between the customer and merchant
*Encrypt the data passing between customer and the company authorizing the credit card transaction
*or Take sensitive information offline

For example many companies use the Secure Socket Layer (SSL) security method developed by Netscape Communications that automatically encrypts data passing between your Web browser and a merchant’s server.

In person, it is easy to check for matching signature on a card or to ask a person for an ID. On the internet, it is virtually impossible. Authentication thus can only occur through cryptography, SET uses a robust set of digital certificates to accomplish the identification and authentication activity.

SET is expected to eventually become dominant standard for secure electronic payments in the internet. However, SET has been stalled by the reluctant of companies to incur its increased hardware, software and cost requirement.
Secure Electronic Payments or SET