The credit card was designed to handle the situation where the
purchaser trusts the vendor. The problem is, once you give your credit
card number to a business, they can use it to put subsequent charges
on your account beyond the agreed transaction. They can also sell
your number to criminal enterprises.
Further, when you have paper, the vendor can change the amount after
the bill is signed.
So what we need is:
1. a smart card for face to face transactions.
2. something more akin to paypal for online transactions.
The idea is, the vendor finds money is his account and knows who it
came from, but has no way of using that information to extract more
money.
There another security breach which could explode at any minute, and
that is PAC (Pre Authorised Chequing) Basically any business, knowing
only your chequing account information, can take money out of your
account by sending list of bank accounts and amounts to the bank. The
"donor" does not have to ok this is a any way. He might catch it on
the statements, but with a bit of cleverness, the charge could be
disguised or made small enough for the donor to let it slide.
One way it might work is when you want to buy something with a credit
card, you send a message to the bank, with the recipient, amount, and
your account digitally signed. The bank then digitally signs it
authorising the transaction, and sends a copy to the recipient, or you
can give it to him. That is his unforgeable "ticket" to prove he is
owed the money.
Given the problems with identity theft as so much credit card and
debit card fraud, you'd think a system like this would pay for itself
very quickly.
--
Roedy Green Canadian Mind Products
The Java Glossary
http://mindprod.com
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