Unit 1: Introduction to E-Commerce.

1. Introduction to E-Commerce

Definition & Concept

• E-Commerce (Electronic Commerce): Refers to the buying and selling of

goods, services, or information via electronic means, primarily computer and
telecommunication networks.
• Broader Scope: It involves not just buying and selling but also automating
manual processes, paperless exchange of information (via EDI, email, etc.),
and transforming how organizations operate.
• E-Business vs. E-Commerce: While often used interchangeably, "E-
Business" is a broader term that includes e-commerce plus internal business
processes like communicating with employees and collaboration. E-
commerce is the transactional subset of e-business.

Evolution of E-Commerce

1. Electronic Data Processing (EDP) Era (1955-1974): Focus on data

processing.
2. Management Information System (MIS) Era (1975-1994): Improvement in
internal management processes.
3. Internet and E-business Era (1995-Present): The Web made e-commerce
economical and enabled diverse online business activities.

2. Business Models and Categories

E-commerce is classified based on the nature of the buyer and seller.

1. Business-to-Consumer (B2C)

• Description: Businesses sell products or services directly to individual

consumers.
• Examples: [Link], Flipkart, virtual malls.
• Key Challenge: The retailer often sells to unknown strangers, requiring extra
effort for payment security and verification compared to B2B.

2. Business-to-Business (B2B)

• Description: Commercial transactions between two or more businesses (e.g.,

manufacturer to distributor).
• Features: Often involves "trusted business partners" and supply chain
technology. It accounts for a large share of commercial activity.
• Comparison: B2B is generally more focused (e.g., buying specific motor
parts) and involves complex supply chains compared to B2C.

3. Consumer-to-Consumer (C2C)
 • Description: Consumers sell directly to other consumers, often via classifieds
or auctions.
• Examples: eBay (auction format).
• Mechanisms: Relies on rating systems to build trust and payment
intermediaries like PayPal to handle money securely.

4. Consumer-to-Business (C2B)

• Description: A "reverse auction" model where buyers name their price

("demand collection"), and businesses bid to fulfill it.
• Examples: [Link], Reverse [Link].

5. Business-to-Government (B2G): Transactions between businesses and

government entities.

Operational Models:

• Pure Online Models: Businesses that exist only online (e.g., Amazon, eBay).
They have lower overheads but high marketing costs to acquire customers.
• Bricks and Clicks: Traditional physical stores that also have an online
presence (e.g., a local appliance store with a website). This builds trust as
customers know they can visit a physical location for returns or service.

3. Drivers and Functions

Forces Driving E-Commerce

• Economic Factors: Lower infrastructure and transaction costs; low cost of

sharing information.
• Marketing Factors: Ability to reach niche markets, improved customer
service, and better brand loyalty through direct interaction.
• Technological Factors: Convergence of IT and communication technologies,
multimedia capabilities, and the explosion of the World Wide Web.

Functions of E-Commerce

• Online transaction processing.

• Supply chain management and Electronic Data Interchange (EDI).
• Customer Relationship Management (CRM).
• Secure payment and logistics support.

4. Advantages and Disadvantages

Advantages Disadvantages
Global Reach: Access to distant markets Security Risks: Virus threats, data
and 24/7 operation. interception, and fraud.
Advantages Disadvantages
Cost Savings: Lower staffing costs, High Start-up Costs: Expenses for
reduced processing errors, and lower hardware, software, connection, and
inventory/warehouse costs (JIT). maintenance.
Lack of Human Touch: Impersonal
Speed: Faster response times and real-
nature; some customers prefer face-to-
time interaction.
face interaction.
Lower Barriers to Entry: Small firms can Technical/Legal Issues: Unclear laws,
compete with large multinationals on the fluctuating technology standards, and
Web. need for skilled staff.
Product Limitations: Difficult to sell
Increased Choice: Buyers can easily
perishable goods or items needing
compare products and prices globally.
physical inspection (e.g., jewelry)

5. Applications and Online Services

A. E-Banking (Internet Banking)

• Services: Fund transfers, bill payments, account statements, fixed deposits,

etc..
• Pros: Saves time, 24/7 access, eco-friendly (paperless).
• Cons: Security fears (hacking), requires internet connection and computer
literacy.

B. E-Insurance

• Concept: Issuing policies, negotiating contracts, and settling claims online.

• Pros: Reduces administrative costs and agent commissions; allows easy
comparison of policies.
• Cons: Not suitable for complex products requiring consulting; lacks human
interaction.

C. Payment of Utility Bills 43

• Concept: Paying electricity, water, or phone bills online.

• Pros: Automatic payment plans ensure bills are paid on time; cheaper for
companies than processing checks.
• Cons: Risk of overdrafts with auto-pay; sometimes extra fees apply.

D. E-Marketing

• Concept: Promoting products via websites, email, and social media.

• Pros: Low cost compared to traditional ads, precise demographic targeting,
and measurable analytics (views/clicks).
• Cons: High "ignore rate" (ad blockers), and techniques become obsolete
quickly.

E. E-Tailing & Online Shopping

 • Concept: Selling retail goods directly to consumers (B2C).
• Major Players: Amazon (global), Flipkart & Snapdeal (India), Alibaba (B2B),
Grofers (Grocery).
• Pros for Sellers: Less investment in physical showrooms, elimination of
middlemen51515151.
• Pros for Buyers: Vast selection, easy comparison, convenience.
• Cons: Cannot touch/smell products, delivery delays, missing personal advice.

F. Other Services:

• Online Career Services: Job seekers post resumes; employers search for
talent (e.g., Naukri, Monster).
• E-Auctions: Platforms like eBay where price is determined by bidding; allows
perfect information on demand/supply.
• Online Travel: Booking flights, hotels, and rail tickets; allows easy fare
comparison.

6. Requirements for Implementation

To successfully launch an e-commerce presence, a business needs:

1. Product/Service: Something to sell.

2. Website: A place to display goods.
3. Infrastructure: Hardware, software, and network.
4. Payment Gateway: A way to accept money (credit cards, net banking).
5. Logistics: A fulfillment capacity to deliver the goods.
6. Support: Mechanisms for returns, warranties, and customer service.

Unit 2, divided into Internet Concepts and Website Designing (HTML & CSS).

Part 1: Internet Concepts

(Source: UNIT [Link])

1. Uniform Resource Locator (URL)

• Definition: The unique address of a web resource, similar to a home address.

It helps the browser find a specific webpage .
• Components of a URL:
1. Web Protocol (e.g., [Link]
2. Name of the Web Server (e.g., [Link])
3. Directory (e.g., /students/)
4. File within the directory (e.g., [Link]) .

2. Internet Protocols
 • Definition: Protocols are rules that define how data is sent and received over
the internet.
• Major Protocols:
o IP (Internet Protocol): Assigns a unique number (IP Address) to
devices.
o TCP (Transmission Control Protocol): Breaks data into packets and
reassembles them correctly upon arrival.
o UDP (User Datagram Protocol): Sends data quickly without error
checking; used for live streaming.
o HTTP / HTTPS (Hypertext Transfer Protocol / Secure): Transfers
webpages between the browser and the server.
o FTP (File Transfer Protocol): Used for uploading and downloading
files.
o Email Protocols (SMTP / POP / IMAP): Used for sending and
receiving emails.

3. Internet Service Provider (ISP)

• Definition: A company that provides access to the internet for people and
businesses (e.g., JioFiber, Airtel, BSNL).
• Functions:
o Connects devices to the internet network.
o Maintains server and network infrastructure.
o Monitors and maintains customers' web activity.

4. World Wide Web (WWW)

• Definition: A collection of webpages and websites connected to each other

that can be accessed via the internet.
• Key Components: Web Server, Web Browser, Websites, Webpages, URL,
HTTP/HTTPS.
• Uses: Education, Business, Communication, Entertainment, Research &
Information.

5. Domain Name System (DNS)

• Definition: Often called the "phonebook of the internet." It translates domain

names into IP addresses so computers can find them.

Part 2: Website Designing (HTML)

(Source: Unit 2 part [Link])

1. Introduction to HTML

• HTML (Hyper Text Markup Language): A markup language used to create

and display webpages.
• Tags: Commands enclosed in < > brackets. They are not case-sensitive.
 o Container Tags: Have an opening and closing tag (e.g.,
<html>...</html>).
o Empty Tags: Stand-alone tags with no closing tag (e.g., <br>, <hr>).
• Basic Structure:
o <html>: Starts and ends the document.
o <head>: Contains information like the title.
o <title>: Text appears in the browser title bar.
o <body>: Contains all visible content (text, images, links).

2. Text Formatting Tags

• Headings: <h1> (largest) to <h6> (smallest).

• Font: Controls look of text. Attributes: size (1-7), color (name or hex code), face
(font style).
• Paragraphs & Breaks:
o <p>: Defines a paragraph.
o <br>: Inserts a line break (empty tag).
• Physical Style Tags:
o <b> Bold, <i> Italics, <u> Underline.
o <strike> Strikethrough, <sub> Subscript, <sup> Superscript.
o <big> / <small> Increase/decrease font size by one point.
o <marquee> Scrolling text.
• Other Tags:
o <blockquote>: Double indents text.
o <pre>: Pre-formatted text (preserves spaces/breaks).
o <div>: Divides content into sections.
o <hr>: Horizontal Rule (line). Attributes: size, width, color, noshade.
o <address>: For author contact info.
o Comments: `` (ignored by browser).

3. Lists

• Unordered List (<ul>): Bulleted list. Items use <li>. Attributes: type (disc, circle,
square).
• Ordered List (<ol>): Numbered list. Items use <li>. Attributes: type (1, a, A, i, I)
and start (number to start from).
• Definition List (<dl>):
o <dt>: Definition Term.
o <dd>: Definition Description.

4. Graphics (Images)

• Tag: <img> (Empty tag).

• Attributes:
o src: Source filename/URL.
o alt: Alternative text.
o width / height: Dimensions in pixels.
o border: Border thickness.
o align: Alignment (top, bottom, middle).
• Background: Use <body background="[Link]"> for image or bgcolor for color.
5. Hyperlinks (Anchors)

• Tag: <a>.
• Types:
o Local: Link to a page in the same website.
o External: Link to another website (e.g., href="[Link]
o Internal: Link to a section within the same page (uses href="#name" and
<a name="name">).
o Email: href="[Link]
• Link Colors (Body attributes): link (unvisited), vlink (visited), alink (active).

6. Tables

• Tags: <table>, <tr> (row), <th> (header cell), <td> (data cell) .
• Table Attributes: border, cellpadding (space inside cell), cellspacing (space
between cells), bgcolor, background.
• Cell Attributes (td/th): colspan (merge columns), rowspan (merge rows), align,
valign.

7. Frames

• Concept: Divide browser window into parts to view multiple pages

simultaneously.
• Tags:
o <frameset>: Replaces <body>. Attributes: rows, cols (pixels, %, or *).
o <frame>: Defines content for a section. Attributes: src, name, scrolling
(yes/no/auto), noresize.
o <noframes>: Content for browsers that don't support frames.
• Targeting: Use <base target="framename"> to open links in a specific frame.
Reserved targets: _blank (new window), _self (same frame), _top (full window),
_parent.

8. Forms

• Purpose: Collect user data and communicate with the server.

• Container Tag: <form> with attributes method (GET/POST) and action (URL) .
• Input Elements (<input>):
o type="text": Single line text box. Attributes: size, maxlength, name, value.
o type="checkbox": Select multiple options. Attribute: checked.
o type="radio": Select only one option from a group (must share same
name).

Part 3: Advanced HTML & CSS

(Source: unit 2 part [Link])

1. Forms (Continued)

• Input Types:
 o type="password": Hides text with asterisks (*).
o type="hidden": Sends data to server without showing it to user.
o type="reset": Clears form to default values.
o type="submit": Sends form data to the server.
o type="image": Uses an image as a submit button.
• Text Area: <textarea> for multi-line text input. Attributes: rows, cols, wrap.
• Drop Down List: <select> tag containing <option> tags. Attributes: multiple (allow
multiple selections), size (number of visible items).
• Methods:
o GET: Retreives data; appends data to URL (less secure).
o POST: Updates data; sends data in body (used for sensitive info).

2. HTML Character Entities

• Usage: To display reserved characters (like < or >) that browsers might
mistake for tags.
• Examples:
o &lt; or &#60; for <
o &gt; or &#62; for >
o &amp; for &
o &quot; for "
o &nbsp; for Non-breaking space
o &copy; for Copyright symbol ©
o &reg; for Registered trademark ®.

3. Cascading Style Sheets (CSS)

• Definition: Provides a way to customize the look of multiple pages or

elements at once, offering richer detail than HTML tags.
• Syntax: Selector {property: value;} (e.g., H1 {color: green;}).
• Methods of Applying CSS:
1. Linking (External):
▪ Create a .css file.
▪ Link it in the HTML <head> using <link rel="stylesheet" href="[Link]"> .
▪ Useful for applying consistent style across a whole website.
2. Embedding (Internal):
▪ Define styles within <style>...</style> tags inside the <head> section
of the HTML document.
▪ Affects only that single document.
3. Inline:
▪ Apply style directly to an HTML tag using the style attribute (e.g.,
<p style="color: red">).
▪ Affects only that specific element instance.

Unit 3: E-Payment Systems.

1. Introduction to E-Payment Systems

E-Payment (Electronic Payment) refers to paperless monetary transactions where
payment is initiated, processed, and received electronically. It effectively replaces
traditional modes like cash and cheques with digital alternatives, facilitating e-
commerce operations.

• Examples: Online shopping, doctor consultations, salary credits, movie ticket

bookings, etc.
• Common Modes: Credit/Debit cards, E-wallets, UPI, NEFT, RTGS.

2. Advantages & Disadvantages

Advantages Disadvantages
Convenience & Speed: Faster than Security Concerns: Risk of fraud,
cash/cheques; available 24/7. phishing, and theft.
Lower Costs: Reduces operational
Technical Reliance: Requires internet
costs for businesses (handling cash,
access and technological infrastructure.
etc.).
Lack of Anonymity: Transactions are
Global Reach: Facilitates international
traceable, reducing privacy compared to
trade and competitive advantage.
cash.
Disputes: Difficult to resolve transaction
Paperless: Environmentally friendly.
disputes.

3. Payment Cards

A. Credit Cards

• Definition: A plastic card with a magnetic strip or chip linked to a bank

account with a pre-set credit limit. It allows customers to buy now and pay
later.
• Parties Involved:
1. Card Holder: The customer.
2. Issuer Bank: The bank that issued the card.
3. Merchant: The seller accepting payment.
4. Acquirer Bank: The merchant’s bank.
5. Card Brand/Network: Visa, Mastercard, RuPay.
• Advantages: Widely accepted, enables remote transactions, provides credit.
• Disadvantages: Interest charges on late payments, annual fees, security
risks.

B. Debit Cards

• Definition: A card linked directly to a user's bank account. Funds are

deducted immediately upon transaction.
• Key Feature: Requires a Personal Identification Number (PIN) for
authorization.
 • Comparison: Unlike credit cards, there is no credit line; you spend your own
money.

C. Smart Cards

• Definition: A card with an embedded microprocessor chip that can store data
and perform calculations. It is more secure than magnetic strip cards.
• Types:
1. Contact Smart Cards: Must be inserted into a reader (e.g., Chip-and-
PIN cards).
2. Contactless Smart Cards: Use radio frequency (RFID/NFC) to
communicate with the reader by waving the card near it.

4. Digital Payment Instruments

• E-Wallet (Digital Wallet): A software application (on a phone or computer)

that stores payment information and passwords for numerous payment
methods and websites. It enables quick payments without typing details every
time.
• Digital Cash (E-Cash): Money exchanged electronically via the internet or
distinct networks. It mimics physical cash attributes like anonymity and ease
of transfer.
• E-Cheque: A digital version of a paper cheque. It is a legally binding
electronic document sent via email or web to the payee.
• Digital Currency: Money that exists only in electronic form (no physical
cash).
o CBDC (Central Bank Digital Currency): E.g., Digital Rupee.
o Private Digital Currencies: E.g., Cryptocurrencies.

5. Payment Gateways

• Definition: An e-commerce service that authorizes credit card or direct

payments. It acts as a bridge between the merchant's website and the bank.
• Function: It encrypts sensitive information (like credit card numbers), verifies
the details with the bank, and ensures the funds are transferred securely.
• How it Works:
1. Customer enters card details on the website.
2. Gateway securely sends this data to the bank.
3. Bank approves/declines the transaction.
4. Gateway informs the merchant and customer of the status.

6. Online Banking & Fund Transfers

Online banking allows customers to perform financial transactions via the internet.
Key transfer modes include:

A. Electronic Fund Transfer (EFT)

 • Concept: General term for transferring money from one bank account to
another electronically without paper money.
• Benefits: Lower administrative costs, increased efficiency, and security.

B. NEFT (National Electronic Funds Transfer)

• Type: One-to-one funds transfer system.

• Processing: Transactions are processed in batches (usually every half
hour). It is not real-time.
• Limit: No minimum or maximum limit for individuals (though cash transactions
may be limited to ₹50,000).

C. RTGS (Real Time Gross Settlement)

• Type: Real-time transfer of funds.

• Processing: "Real-time" means instant; "Gross" means individually (not
bunched). Once processed, it is final and irrevocable.
• Limit: Primarily for high-value transactions. Minimum amount is ₹2 Lakhs.

D. IMPS (Immediate Payment Service)

• Type: Instant interbank electronic fund transfer service available 24/7/365.

• Channels: Can be accessed via mobile, internet, ATM, and SMS.
• Key Feature: Supports instant transfers even on holidays.

E. Other Modes

• ACH (Automated Clearing House): Used for bulk transactions like payroll,
dividends, or pension payments.
• ECS (Electronic Clearing Service): A mode for repetitive, periodic payments
(like electricity bills or SIPs) where a user mandates the bank to debit their
account periodically.

7. Unified Payments Interface (UPI)

• Definition: A system developed by NPCI (National Payments Corporation of

India) that powers multiple bank accounts into a single mobile application (of
any participating bank), merging several banking features, seamless fund
routing, and merchant payments into one hood.
• Key Features:
o Virtual Payment Address (VPA): Eliminates the need to share
sensitive bank details like account number/IFSC.
o 2-Factor Authentication: Uses MPIN for security.
o Push & Pull: Allows sending (Push) and requesting (Pull) money.
• Architecture (Participants):
o Payer App / PSP: The app used by the sender.
o NPCI: The central switch connecting all banks.
o Payee App / PSP: The app used by the receiver.
o Remitter/Beneficiary Bank: The actual banks holding the funds.
 • BHIM (Bharat Interface for Money): A specific app based on UPI developed
by NPCI to facilitate simple, quick, and secure transactions.

8. Emerging & Other Systems

• AEPS (Aadhaar Enabled Payment System): A bank-led model allowing

online interoperable financial inclusion transactions at Micro-ATM/PoS
through the Business Correspondent of any bank using Aadhaar
authentication.
• PayPal: A global third-party financial service that allows users to pay, send
money, and accept payments without revealing financial details to the other
party.
• Cryptocurrency: A form of digital currency using cryptography for security. It
operates independently of a central bank (decentralized).

9. Security & Legal Aspects

• Risks:
o Phishing: Tricking users into revealing passwords.
o Skimming: Stealing card details during a swipe.
o Identity Theft: Using someone else's identity for fraud.
• Legal Position (Digital Signatures):
o Information Technology Act, 2000: Gives legal recognition to digital
signatures in India.
o Section 5: States that where any law requires a signature, a digital
signature satisfies that requirement if done as prescribed.
 o Authentication: Section 3 provides for the authentication of electronic
records via digital signatures.

Case Study: "ArtisanHub" Goes Global

Question:

"ArtisanHub," a traditional handicraft store based in India, wants to expand its reach
by selling its products directly to individual customers worldwide via the internet.
Additionally, they plan to supply bulk orders to other small retail shops in different
cities. To achieve this, the owner decided to launch a dedicated website.

The website needs to have the following features:

1. A "Top Sellers" section displaying the most popular items in a numbered list
(1, 2, 3...).
2. A "Reseller Registration" page where other business owners can sign up by
entering their name and password.
3. A secure system to accept payments from both international customers and
local buyers.

Based on the scenario above, answer the following:

1. Identify the two specific E-Commerce business models ArtisanHub will be

adopting.
2. Suggest the specific HTML tags required to create the "Top Sellers"
numbered list and the "Reseller Registration" form (specifically the tags for the
list, the form container, and a password field).
3. Recommend one suitable payment instrument for international customers
and one for local mobile-savvy customers. Also, explain the role of a
Payment Gateway in securing these transactions.

Answer:

1. E-Commerce Business Models:

• B2C (Business-to-Consumer): ArtisanHub is adopting the B2C model by

selling goods directly to individual customers worldwide via the internet.
• B2B (Business-to-Business): By supplying bulk orders to other small retail
shops, they are engaging in B2B transactions, which occur between two or
more businesses.

2. Required HTML Tags:

• For the Numbered List: The <ol> (Ordered List) tag should be used to create
the numbered list, with each item inside an <li> (List Item) tag.
• For the Registration Form:
o The <form> tag is used as the container for the registration section.
 o To accept a password where the characters are hidden (e.g., as
asterisks), the <input type="password"> tag should be used.

3. Payment Recommendations & Gateway Role:

• International Customers: Credit Cards are suitable as they are widely

accepted worldwide for online transactions and allow customers to pay later.
• Local Mobile-Savvy Customers: UPI (Unified Payments Interface) is
recommended as it allows easy, instant transfers using a Virtual Payment
Address (VPA) or QR code without sharing bank details.
• Role of Payment Gateway: The Payment Gateway acts as a bridge between
ArtisanHub's website and the bank. It authorizes credit card/direct payments,
encrypts sensitive information to verify details securely, and ensures funds
are deposited into the merchant's account.