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                                  An electronic credit system

 

An electronic credit card transaction processes the following steps, which can be divided into three phases:

 

Phase I: Purchase of goods

 

1.The consumer accesses a merchant's home page and receives a display of the merchant's goods.

 

2.The consumer selects the desired goods and offers a credit payment to the merchant.

 

3.The merchant server accesses its bank for credit authorization of the consumer's credit card number and the amount of purchase. The merchant's bank completes the authorization and informs the merchant whether to proceed with the purchase or not.

 

4.The merchant informs the consumer whether the transaction has been completed.

 

Phase II: Settlement

 

5.This phase is executed separately by the merchant server to collect the payments on the various credit card purchases.

 

6.The merchant server accesses the merchant's bank and provides a collection of receipts of various electronic credit purchases.

 

7.The merchant's bank accesses the card issuer and obtains the money for the purchases.

 

Phase III: Credit card bill

 

8.In this phase, the card issuer updates the cardholder (consumer) about the amount of credit transferred to other parties as a result of purchases. The consumer may receive the account updates once a month through postal mail.