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A consortium of credit card and technology heavyweights will announce Monday that they've agreed on a virtual credit card standard.
It seems the lure of streamlined e-commerce is strong enough to convince rivals Microsoft and Sun, plus Visa and American Express, to act in concert.
Dubbed e-cards, the technology will enable consumers to make purchases on the Net by dragging and dropping their virtual credit card icon into place rather than going through the laborious process of filling out forms.
The technology is expected to be rolled out later this year.
The E-card is based on the Electronic Commerce Modeling Language or ECML, and is backed by Microsoft, Visa, American Express, IBM, Sun Microsystems, MasterCard, America Online, CyberCash, Compaq, Transactor Networks, and Trintech.
"Our e-card looks like what you have in your wallet but is totally secure because the customer must enter a password when making a purchase," explained John McGuire, CEO of Trintech, the company that co-developed the standard with America Online.
"ECML creates a standard way for the virtual credit cards to interoperate with the merchant server," said Steve Ryan, vice president of emerging technologies for Visa USA. "However issuers may implement the technology in different ways."
Ryan said that previous attempts to standardize online purchasing on the Net have largely failed because one or two vendors have tried to own it. Where ECML differs is that it has widespread support of the key electronic commerce players.
The standard is set to boost the US$101 billion electronic commerce market and, not surprisingly, has received the backing of major online stores, including Beyond.com, Dell Computer, Fashionmall.com, Healthshop.com, Nordstrom, and reel.com.
In the coming months, Microsoft will adopt the ECML standard into its Passport electronic payment product, while Sun will integrate the standard into its JavaWallet payment software. Trintech has just launched an e-card product, called NetIssuer, but as part of its industrial-strength electronic payment system for banks and credit card companies.
CyberCash, which offers a proprietary virtual credit card, has not announced how it will implement the proposed standard.
ECML differs from traditional electronic wallet and online credit card schemes because it is an open standard, so that potentially any credit card vendor or online store can adopt it, according to Seamus McAteer, director of Web Technologies at Jupiter Communications.
"It's a great idea but consumers should be aware that it could lead to more impulse buying," he said. "In a recent survey we carried out, we found that 50 percent of online consumers preferred to fill in the credit card details manually because it made it impulse buying more difficult."
To obtain the virtual credit card, customers will go to their bank or credit card company’s Web site and enter a password. The company's computer system will then install a JavaBean or a Microsoft COM software object on the user’s desktop. While uses will be able change their shipping address, they won't be able to tamper with the credit card number or expiration date.
ECML provides a standard which maps the fields in a credit card to the fields on a online purchasing form. Once the purchase is made, the information is sent over the Internet using the Web browser’s standard security technology such as Secure Electronic Transaction (SET) or Secure Sockets Layer (SSL). The credit card company then issues a digital receipt.
Virtual-card users will be able to store electronic receipts in a desktop folder, and Microsoft is developing a technology that will integrate online credit cards with its Microsoft Money personal accounting software package.
"There is no reason why ECML should not be adopted by everybody," said Blake Irving, general manager of Microsoft’s consumer and commerce group. "The widespread adoption will make the pie bigger for everybody."
