Electronic Commerce

With online shopping and smartphones ubiquitous now, most of us have had experience with electronic commerce (e-commerce). This viable alternative to brick-and-mortar stores can allow your department to sell goods, services, or online products, such as e-books, completely online. Although e-commerce is most often thought of as occurring over the internet, transfer of funds and data can also take place via automated phone banks, touchscreen kiosks, and automated teller machines (ATMs.)

An Overview of Electronic Commerce

Definition

In simplest terms, online shopping consists of adding items to a virtual shopping cart and checking out with a credit or debit card. 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 accomplished via mailing, customer pickup, or the 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 that organizations typically have regarding sales. This is because activity handled via e-commerce is transmitted to your account without leaving the accounting system.

Responsible Department

Merchant Services maintains e-commerce responsibility for the OSU system and is available for assistance in determining the best course of action or for compliance reviews.

Establishing the Electronic Storefront

In a university setting, your business may include electronic notes, seats in a professional seminar, or any other item specific to your department available for purchase. However, converting a physical location where application forms or goods reside to an electronic storefront can be a time-consuming and expensive process—one which involves managing the entire purchase cycle to automate processes and deliver your information to the computer screen.

For this reason, Oklahoma State University has established TouchNet Marketplace as a centralized solution to enable colleges and departments to move to e-commerce with a smaller resource outlay and risk exposure. Before a storefront can be established, however, certain items need to be obtained and internal processes established.

TouchNet Marketplace - uPay vs uStore

With TouchNet Marketplace, your department or college can build and manage secure, web-based shopping cart applications and online payments. Whether you choose Marketplace Universal Stores (uStores) or the Marketplace Universal Payment Site (uPay) will depend upon a few criteria, below.

uPay Requirements (For departments connecting to an existing system)

Must use SSL (Secure Sockets Layer) encryption for all transmissions involving personal data, including name, address, credit card number, or any other personally identifiable data.
Credit card authorizations connect to the centralized solution for OSU.
Internal control structure reviews by Merchant Services are held prior to production and at least annually thereafter.
OSU policy and procedure reviews by Merchant Services are held prior to production and at least annually thereafter.

uStore Requirements (For departments using the existing storefront application)

Internal control structure reviews by Merchant Services are held prior to production and at least annually thereafter.
OSU policy and procedure reviews by Merchant Services are held prior to production and at least annually thereafter.

If you would like assistance deciding upon a solution for your organization, please contact Merchant Services.

Obtaining a Web Credit Card Merchant Number

A web credit card merchant number is identical to a merchant number used in a traditional store with one exception: its issuance is tied to an e-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 Merchant Services. The form is located on the forms page. After the merchant account request form is received, it can take up to four weeks for the merchant number to be created.