MasterCard International and Netscape Communications Corp. are developing a secure payments system for business-to-business transactions over the Internet.
The system, announced at the Faulkner & Gray commercial card conference, will facilitate acceptance of purchasing cards at "virtual malls."
Partners include Citicorp, BankAmerica Corp., General Electric Capital Corp., and First Chicago NBD Corp. The group has been working on the system since November 1995.
"Demand is huge on the corporate side," said Steve L. Abrams, senior vice president, MasterCard International.
Though industry experts have touted the Internet as a commercial mecca where sales will blossom into the billions of dollars by the end of the century, lack of security has been a deterrent.
Clay Ryder, senior industry analyst with Zona Research Inc., said a "handful of players are looking at this and are trying to figure out an angle to approach the market."
Many companies have direct links to the merchants or wholesalers through electronic data interchange. Using the Internet would cut costs by eliminating dedicated lines to those organizations, he said.
The Netscape software for Internet purchases will incorporate the Secure Electronic Transactions standard developed by an industry consortium, including Visa, MasterCard, Microsoft Corp., Netscape, and others.
Initially, only MasterCard purchasing cards will be accepted through the system, with other brands to be added later.
Mr. Abrams said beta testing will begin by the fourth quarter of this year, with issuers Citicorp, GE Capital, Bank of America, and First Chicago; suppliers including Boise Cascade, W.W. Granger, Hamilton Avnet, GE Lighting, and Newark Electronics; and processors First Data Corp. and Global Payment Systems.
