General Information

To offer an e-Commerce component for your department, there are certain necessary rules, responsibilities, restrictions, and of course, benefits. But first, explanations.

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An Overview of Electronic Commerce

Definition

Electronic commerce (e-Commerce) is simply your business over electronic means. This normally means the internet, but can include any electronic interaction – including automated phone banks, touch screen kiosks, or even ATMs.

 

Traditional/electronic sales cycle

In a traditional business sales cycle, the customer shops for an item and comes to the counter/desk for purchase. You accept cash, a check, or a credit card and return change when applicable, thus completing the sale.

 

The e-Commerce sales cycle is similar – the customer shops in an electronic store, fills his/her electronic shopping cart, and proceeds to checkout by clicking a button. At checkout, the customer offers a credit card to purchase the goods. The e-Commerce application reads the credit card number (and other applicable information), requests an approval from a credit card processor, and either completes the sale if an approval is granted or denies the sale for a non-approved card. Delivery of the goods can be via mailing, customer pickup, or internet for electronic media.

 

Accounting

Accounting for sales in e-commerce is highly automated and contains an audit trail allowing the department or college to review activity occurring within the application. Having this automation removes some cash/cash equivalent internal control requirements regarding sales since activity handled via e-Commerce are transmitted to your account without leaving the accounting system.

 

Establishing the Electronic Storefront

In a University setting, your business may include having available for purchase class note CDs, seats in a professional seminar, or any item specific to your department. Converting a physical location where application forms or actual goods reside to an electronic storefront involves managing the entire purchase cycle to automate processes and deliver your information to the computer screen. Doing this from scratch can be a time-consuming and expensive process.

 

At Oklahoma State University, TouchNet Marketplace has been established as a centralized solution to allow departments and colleges the ability to move to e-Commerce with a smaller resource outlay and risk exposure. Before a storefront can be established, however, some items need to be obtained and internal processes worked out.

 

TouchNet Marketplace - uPay vs uStore

Depending on resources and know-how in your department, this may be an easy choice.

 

For those departments considering connecting to an existing system, here are some requirements:

1. Must use SSL encryption for all transmissions involving personal data and includes name, address, credit card number, or any other personally identifiable data.

2. Credit card authorizations connect to the centralized solution for OSU.

3. Internal control structure, and OSU policy and procedure reviews by the office of Financial Information Management prior to production and at least annually thereafter.

For those departments considering using the existing storefront application, here are some requirements:

 

Internal control structure, and OSU policy and procedure reviews by the office of Financial Information Management prior to production and at least annually thereafter.

 

Obtaining a Web Credit Card Merchant Number

A web credit card merchant number is exactly the same as a merchant number used in a traditional store with one exception: its issuance is tied to an electronic commerce indicator. This allows the merchant, processor, and credit card issuer to determine the type of purchase being made and will be discussed in further detail when reviewing card-not-present (CNP) rules and regulations.

 

The department/college must obtain a merchant number from the Office of Financial Information Management. The form is located on the forms page. After the merchant account request form is received, you will be contacted regarding your request within one week.

 

Responsible Department(s)

The office of Financial Information Management maintains e-Commerce responsibility for the OSU system and is available for assistance in determining the best course of action or compliance reviews.