E Money

1.Introduction

Money has existed in civilization for thousands years, originating from both economic and non-economic causes such as tribute, trade, blood money, barter and religious rites. Primitive money took many forms, from cowries’ shells to cattle and whales teeth, and later coinage. The development of money can be divided into four main groups: the first is ‘objects-as-money’ group which consisting of the first generation (trade by barter) and the second generation (trade with valuable objects); the second is ‘currency-as-money’ group which consisting of the third generation (coins) and fourth generation (paper notes); the third is ‘claims-as-money’ group which comprising the fifth (deposit accounts), sixth (‘plastic money’) and seventh generations (electronic payments (EPs) and electronic fund transfers (EFTs)); and the fourth is ‘electronic-impulses-as-money’ group which covering the eighth generation (smart cards) and ninth generation (digital coins). The continued development of money was very much linked to the growth in world trade and commerce. With the onset of the industrial revolution, foreign and domestic trade increased greatly and monetary exchange and payment systems rapidly developed.

It has been suggested that e-money is likely to "lead to a new concept of pocket money, give birth to a new commercial payment system for the Internet, change the way governments pay out benefits electronically, and revolutionize the movement of value over telephone lines and airwaves." The use of e-money in low-value, high-volume transactions opens up a wide variety of new services and changes the way in which old ones can be delivered. However, it seems that e-money products have not yet gained wide acceptance, the reaction to these products around the world has been lukewarm so far. It appears that e-money is ahead of customer demand, for the present time at least. This is due to some concerns about e-money, such as security, privacy and some other issues....