Current online transaction security is usually limited to the transmission of encrypted data between computers. Secure forms of data encription, when combined with the growing skills of merchants at presenting merchandise online and at conducting electronic commerce, are sufficient for today's online business. However, only one in seven online merchants currently reports that most of its orders are placed using encription technologies. Apart from cases where products require final personal negotiation, the primary reason why most Internet-generated transactions are actually concluded offline appears to be lack of confidence in the systems and merchants involved in the transaction. A personal contact provides assurance to buyers that the company behind the Internet site really exists and stands ready to perform.
Parties pass encryption keys to each other.
It does not reveal card information to merchant. The risks involved in online commerce are both real and perceived. There is also the fear that transmissions routed through many computers may be intercepted and redirected, although this can happen only rarely. No wonder people are uneasy about conducting commercial transactions on the Internet. In addition, the protocol calls for encrypted transmission of order information, and, upon verifying and approving a transaction, it notifies the merchant that a sale has been approved and accounts have been credited.