OT (Orwell Topic) US Treasury to introduce Non-Bank replacement for credit cardsgreenspun.com : LUSENET : TB2K spinoff uncensored : One Thread
Uniform internet payment system urged
US TREASURY CALL; EIZENSTAT SEES CREDIT CARD TRANSACTIONS AS TOO COSTLY AND NOT FLEXIBLE ENOUGH:
By DAN LERNER
Financial Times (London); WORLD NEWS; Pg. 8
March 11, 2000, Saturday London Edition
The Clinton administration yesterday called for the introduction of a uniform system for business-to-business and retail electronic payments over the inter-net.
Addressing a private investors' group, Stuart Eizenstat, deputy treasury secretary, said an efficient standards-based mechanism was needed for such payment, as current credit card transactions were costly and could not be used for electronic auctions, one of the internet's fastest growing sectors.
Eizenstat ... said state officials would be able to tax e-commerce after a simplification of the tax code to make it easier for online vendors to enforce.
Mr Eizenstat said his department was more advanced than the private sector in cashless electronic transactions. Treasury officials were already using a number of "revolutionary" systems, including electronic cheque and cash systems that did not use banks as intermediaries.
Smart cards, an electronic form of cash, are being tested by the Treasury, which Mr Eizenstat claimed was the largest producer of such technology.
It is using the cards to cut the cost of paying US troops on military training sites in Bosnia, where army wages are received electronically and can then be spent at vendors who have specially equipped card readers.
Innovations could also speed up business-to-business transactions and the e-cheque, an electronic version of a paper cheque being tested by the Treasury in partnership with Fleet Boston bank and the Pentagon.
Electronic cheques make use of digital signatures, which are considered legally binding in some states but may soon be endorsed nationwide by legislation about to go before a joint congressional committee, known as the "e-sign bill".
The administration's call for a universal payment system comes as financial institutions launch similar credit card-based systems for person-to-person payments over the internet.
However, Mr Eizenstat said that credit card transactions incurred between 2 and 6 per cent charges and did not afford enough flexibility.
"Buyers, sellers and financial institutions need to know with certainty that their payments have been received," he said.
But Jay Walker, founder and chairman of priceline.com, a leading e-commerce company, recently said digital cash had no future. Credit cards had shown they were versatile enough for almost every type of online payment, he said.
Mr Eizenstat also commented on the controversial issue of internet taxation. He said state officials would be able to tax e-commerce after a simplification of the tax code to make it easier for online vendors to enforce.
This elaboration of White House policy comes just two weeks before a special commission holds its final meeting in Dallas. The commission, which is made up of administration officials, business leaders and members of Congress, must present its findings no later than April 21.
Not for commercial use. Solely to be used for the educational purposes of research and open discussion.
-- Possible Impact (email@example.com), March 11, 2000
Now don't get me wrong, bypassing the Fed sounds real good to me.
Saving 6% from merchant fees is cool too! An honest legal tender would go a long way to fixing the mess we are in.
Just need to watch these guys real close, mess this up and we are toast.
-- Possible Impact (firstname.lastname@example.org), March 11, 2000.
We already are toast. Okay, pre-toast. We are already in the toaster, just about to be burned.
-- jeile (email@example.com), March 11, 2000.
All that's left to do is apply butter or jam...
-- INever (firstname.lastname@example.org), March 11, 2000.
No, We're toast now, and have been our whole lives. The only question is which of the big boys get to sit down to breakfast.
-- Someone (ChimingIn@twocents.cam), March 12, 2000.
There's that name again. I swear, Stuart Eizenstat has had more jobs in DC than anyone in US history. I could have sworn he was in the State department just a few months ago, and was in Commerce before that. Heck, he was Jimmy Carter's de facto chief of staff back in the 70's, for Pete's sake! Now here he is in Treasury. Do these guys get extra points for collecting nameplates from various Federal departments?
I doubt he has Clue 1 about the technology he's touting. Some staffer provided all that puffery about the "smart cards" and Mr. Eisenstat dutifully repeated it.
-- DeeEmBee (email@example.com), March 12, 2000.