Secondary market research or customer analysis on Octopus Card (a Essay

Secondary market research or customer analysis on Octopus Card (a product from Hong Kong) - Essay Example e-payment gained momentum. Now a growing number of transactions are occurring via electronic payment systems that serve as alternative to cash. This growth in e-payment has been fueled largely by smart card technology. Smart Card technology evolved in the mid 80’s but initially it was not much in use. During the last decade of 20th century, there was rapid increase in its use for diverse activities. Nowadays people are recognizing the potential of smart card technology for e- payments and are becoming more dependent on smart cards for their transactions. â€Å"Nowadays, most popular payment methods are based on cards i.e. magnetic cards, smart cards, contactless cards† (Ondrus and Pigneur, 2). E-Payments experienced a compound annual growth rate of 12.3 % globally during 1999 to 2004 (Global Electronic Payments Market Study and Forecast, 7). Today consumers, banks, merchants and retailers prefer electronic transactions. In U.S. alone, e-payments accounted for more than two-thirds of non cash transactions in 2006. In U.S. the electronic payment methods including debit and credit cards are displacing paper checks and cash payments at an accelerating pace (Wall Street Journal). Electronic money transactions are carried out mainly by three methods: credit, debit and stored value prepaid cards. Credit Card: Credit cards are based on buy-now-pay-later strategy. Examples of credit-based payment are Visa, Master and American Express smartcards. Credit cards are most popular payment method in the U.S. Debit Cards: Debit cards have a similar cost structure as that of the credit cards. But unlike credit cards, the amount from the account of the consumer is debited immediately. Consumer needs to enter a PIN in debit card transactions that proves time consuming for micro payments. Contactless Stored Value Cards: Third type of e-payment method is stored value smart cards. The stored value smart cards may be single purposed cash cards, multi-purposed payment