Digital wallets, seem to be the solution agreed upon by a consortium of merchants, vendors, and the major credit card issuers as a new standard for formatting credit card and shipping data over the web. Electronic Commerce Modeling Language, (ECML) provides a common way to structure Web forms that obtain credit card and shipping data for website storefronts. ECML also provides a standard format for storing that user information in a digital wallet on a PC. This way, customers can drag the data from their desktops into merchants' forms, rather than typing it each time they wish to place an order.

Customers have been shown to abandon purchases prior to inputting their credit card and mailing information. This "cold feet" problem, is some 26% more commonly cited as a reason to abandon web purchases, than security fears are, recent surveys show. The new standardized web forms proposed may go a long way towards reducing some of that themselves, as consumers become more familiar with them.

ECML is supported by the Who's Who of ecommerce players. They included Compaq, Dell, iGo, IBM, Microsoft, SETCo, Sun, Transactor Networks, and Trintech. American Express, MasterCard, and Visa, also have agreed to support the standard (inasmuch as they don't sell anything) which is the internet equivalent of the old card imprinter that traditional retailers used to process credit card data on paper forms. This may also bode well for independent software programs that deal directly with bank Merchant Accounts for online sellers.

It could be at least three years before digital wallets are widely used, which themselves raise other serious questions. If hackers can devise elaborate worms and viruses to steal peoples passwords, serial numbers and mailing lists off computers, as they are already prone to, will people really feel safe having that information stored on their PC's or Laptops? Windows 98/NT is particularly vulnerable to these and other well known hacks, to say nothing of the hazards of hardware theft.

Will ECML Fly?

Most certainly these new standards will be adopted by all who accept online payments eventually and the automation may also work to calm customer fears about things like "just why do they want to know all this stuff anyways?" when presented with a payment form (they'll tell all anyways). Whether or not people choose to trust wallet program applets that are meant to store such information on their computers hard drives or in invisible virtual transactions is another question. With the ever-increasing instability of operating systems, and the proliferation of low budget hardware, consumers may be better advised to keep their information to themselves. Surely some of the less sensitive "standard" things such as addresses, etc, can and should be pre-stored without danger. Otherwise, a hybrid solution that allows all but the most sensitive data (credit card numbers and expiry dates) to be "dragged and dropped" is very much in order, but appears to be precluded by this somewhat over-optomistic standard for the "virtual" wallet.

Other Methods?

Others like Britain's Egg.com have chosen to go their own way, being credit card providers themselves. They are launching a "bonus points" e-commerce mini-network of their own, which allows users of their card, with an appropriate "egg-cookie" in their browser, to buy from selected e-tailers. Their system automatically fills in the customer information at checkout using the "egg wallet" information stored on their system. While this sounds good on paper the jury is still out on it's security and broader application. At least the sensitive information is stored where it already exists, but how this might impact credit card e-commerce in general is anyones guess. If other companies see this as a big success, they may become even more reluctant to "share" their clients with other e-tailers.

This model imposes a far higher bandwidth requirement for credit card e-transactions, since much more information than a mere authorization number gets involved in the process, and credit card processors could be put out of business by such a scheme!

Also see: Ecommerce Troubles!