Question

Elaborate the steps involved in on-line trading.

Answer 1

Online trading enables its customers to trade from anywhere. The following are the various steps involved in online trading.

(a) Registration: To begin with, an indenting buyer needs to find an appropriate and reliable shopping website to buy the desired product or products. Once the buyer finds the website, he or she needs to register his or her name by opening a shopping account with the website. For doing so, the buyer is required to key in details such as his or her name, address, unique user name and secret password.

(b) Placing an order:After opening an account, the buyer can start browsing through the products listed, go through other customers’ reviews and compare products. The buyer may select various items according to his or her preferences and put them in a ‘cart’. The buyer can place an order and proceed towards the payment window.

(c)Payment mechanism:In this step, the buyer chooses a preferred mode of payment. The following are the different payment modes that are generally available to a trading website user.

(i) Cash on delivery (CoD): Here, payment is made in cash at the time of delivery of a product.

(ii) Cheque: The user makes payment through cheque, and when the cheque is realised, the goods selected are delivered by the seller.

(iii) Net banking: The user makes an electronic payment to the bank account of the online vendor through the Internet.

(iv) Credit or debit card: The user can also use a credit or debit card (also known as plastic money) to make an online payment. The payment so made is linked to the bank account of the user.

(v) Digital cash or e-cash: This type of currency has no physical existence. It is a system of purchasing cash in relatively small amounts and storing it in the computer system. The consumer can spend the cash when making electronic purchases over the Internet.