Communications of the acm

60
June 2007/Vol. 50, No. 6
COMMUNICATIONS OF THE ACM
Cotteleer table 2 (6/07)
Product Attributes
Offers direct savings over check processing?
Facilitates reconciliation and dispute management?
Provides global coverage?
Improves control over payment timing and cash flow?
Increases visibility of cash requirements?
Reduces fraud and credit loss potential?
Possesses remittance data?
Offers low implementation costs?
Integrates data and payment information?
Offers a flexible fee schedule?
1.
2.
3.
4.
5.
6.
7.
8.
9.
10.
X
X
X
X
X
X
A
C
H
-B
as
ed
P
la
tfo
rm
X
X
X
X
X
X
X
X
X
E
n
h
an
ce
d
P
-C
ar
d
X
X
X
X
X
X
X
X
X
X
O
p
en
N
et
w
o
rk
S
ys
te
m
Cotteleer table 2 (6/07)
E-Payment
Technology
Medium to
High Value
Recurring or
Non-Recurring
Global Network
Low to
Medium Value
Recurring 
Domestic Network
Low Value
Non-Recurring
Domestic Network
(limited global capabilities)
Open 
Network
ACH-Based
Platform
Enhanced
P-Card
Typical 
Transaction
Value
Typical 
Transaction
Frequency
Reach
Table 1. E-payment
technologies and 
associated product
attributes. 
Table 2. Optimal e-payment 
application. 

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orientated businesses to conduct low-value nonrecur-
ring transactions, as in Table 2. 
O
PEN
N
ETWORK
S
YSTEMS
Open network systems, like Visa’s “Visa Commerce”
platform, are rules-based e-payment systems that utilize
open, secure, global-settlement networks to process
buyer-initiated payments. Open networks interface
directly with front-end procurement and accounts-
payable systems to provide buyers and suppliers alike
with a seamless, integrated corporate payment solution.
Open networks also enable buyers to initiate and settle
payments based on preestablished terms with suppliers. 
Unlike enhanced p-card and ACH-based platforms,
open networks employ a flexible fee schedule, allowing
for the minimization of fees for relatively high-dollar-
amount transactions. In addition, open-network solu-
tions may be easier to integrate with legacy
environments. For example, Visa Commerce was
designed to integrate with existing procurement appli-
cations, regardless of their sophistication. This integra-
tion strategy means that financial institutions, buyers,
and suppliers that want to use an open network can do
so with minimal up-front investment. Finally, open
networks typically offer global coverage, a major con-
sideration for moderate-to-large-size firms. Open net-
work payments appear to be best suited for relatively
large-value, multiple-invoice directed payments, as they
circumvent interchange fees and support robust trans-
action data.