Unit 4.1
Unit 4 Intro: E-commerce Security and Payment Systems
IT 204: E-Commerce
Learning Objectives
By the end of this chapter, you will be able to:
✅ Define the six key dimensions of e-commerce security.
✅ Explain why security is a critical foundation for online commerce.
✅ Identify the unique security challenges within the Nepali e-commerce environment.
Why Security Matters ⚡
For e-commerce to function, a fundamental element must be present: Trust .
Both customers and merchants must be confident that their data and their money are safe.
In this unit, we will explore:
Major Security Threats
Key Technology Solutions (like Encryption)
Essential Management Policies
Electronic Payment Systems
📊 Marketing Funnel Visualizer
The E-commerce Security Environment
The security environment is complex and constantly evolving. To build a comprehensive security plan, we must understand its core dimensions.
The Six Key Dimensions of Security 📊
Integrity
Nonrepudiation
Authenticity
Confidentiality
Privacy
Availability
🔍 SEM Keyword Bidding Simulator
buy laptops online Nepal
Searches/mo: 8,200
Competition: High
Suggested bid: NPR 45
Your bid (NPR):
—
cheap smartphones Kathmandu
Searches/mo: 5,400
Competition: Medium
Suggested bid: NPR 28
Your bid (NPR):
—
Daraz deals today
Searches/mo: 22,000
Competition: High
Suggested bid: NPR 15
Your bid (NPR):
—
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Dimensions 1 & 2
1. Integrity
Ensuring information is not altered by an unauthorized party during transmission or on a website.
Example: Preventing a hacker from changing the price of an item from Rs. 1000 to Rs. 1 while it's in your shopping cart.
2. Nonrepudiation
The ability to ensure that participants cannot deny (repudiate) their online actions.
Example: A customer cannot deny placing an order, and a merchant cannot deny sending a shipment.
Dimensions 3 & 4
3. Authenticity
The ability to identify the identity of a person or entity you are dealing with online.
Example: Knowing you are giving your credit card details to daraz.com.np and not a fake phishing site.
4. Confidentiality
Ensuring messages and data are available only to those authorized to view them.
Example: Your credit card number is encrypted so that a snooper on the network cannot read it.
Dimensions 5 & 6
5. Privacy
The ability to control the use of personal information provided to an e-commerce merchant.
Example: You have the right to know how a merchant uses your purchase history and personal data.
6. Availability
Ensuring an e-commerce site continues to function as intended and is accessible to legitimate users.
Example: The website is protected from Denial-of-Service (DoS) attacks and remains online during a big sale event.
🎯 Channel Comparison: Which Marketing Channel?
Practical Application: The Nepali Context 🇳🇵
The e-commerce security environment in Nepal is developing rapidly, but it faces several specific challenges.
Understanding these local challenges is crucial for building successful and secure e-commerce businesses in Nepal.
Key challenges include:
High prevalence of Cash on Delivery (COD)
Lack of public awareness about online security
A still-developing legal and regulatory framework
Limited use of secure payment gateways by smaller vendors
Challenge in Nepal: COD & Payment Security
High Reliance on Cash on Delivery (COD)
While popular, COD introduces physical security risks:
Risk of robbery for delivery personnel.
Risk of customers refusing payment upon delivery.
Increases cash handling complexity and costs.
Insecure Payment Methods
Many smaller businesses bypass secure gateways:
Payments via direct bank transfer or social media messages.
No automated verification or fraud protection.
Higher risk of payment disputes and scams for both parties.
✉️ Email Subject Line A/B Tester
Click the subject line you think gets a higher open rate:
Challenge in Nepal: Awareness & Regulation
🔍 Lack of Awareness
Many consumers are not fully aware of online risks, making them vulnerable to:
Phishing scams (fake login pages)
Fraudulent sellers
Identity theft
⚖️ Developing Legal Framework
The legal framework for e-commerce is still maturing. This can lead to:
Difficulty in prosecuting cybercriminals.
Unclear processes for consumer rights protection.
Ambiguity in handling cross-border transaction disputes.
🧮 Nepal Customer Acquisition Cost Calculator
Facebook Ads (CPC: NPR 8)
Google Ads (CPC: NPR 25)
Cost Per Acquisition (CPA)
NPR 400
Nepal benchmark: Facebook CPC ~NPR 8, Google CPC ~NPR 25. E-commerce avg CVR: 1.5–3%.
Key Takeaways 🎯
E-commerce security is built on six core dimensions: Integrity, Nonrepudiation, Authenticity, Confidentiality, Privacy, and Availability.
Trust is the foundation of all e-commerce. Without security, there is no trust, and therefore, no transactions.
The Nepali e-commerce landscape has unique security challenges, including risks from COD prevalence and a need for greater consumer awareness and stronger regulation.
Thank You
Next Up: 4.2 - Security Threats in Detail
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