E-Commerce and M-Commerce: Models, Payments and PYQs

The correct answer is D, both A and C. In an auction the price is not fixed by the seller but is discovered from what buyers are willing to bid, and this way of trading appears at two levels. Between businesses, industrial exchanges and procurement portals run reverse auctions and dynamic pricing for bulk material, which is B2B commerce, so option A is part of the answer. Between individuals, classified and auction platforms let one consumer bid for goods another consumer is selling, which is C2C commerce, so option C is also part of the answer. Option B, C2B commerce, is where an individual supplies a service or content to a firm, as a freelancer or a stock photographer does, and the price there is normally negotiated rather than auctioned. Because both the business-to-business and the consumer-to-consumer levels fit, the combined option D is right.

The correct answer is C, C2C, which stands for consumer to consumer. Here both sides of the deal are individuals and the website only provides the listing, the search and sometimes the payment and dispute machinery, earning a fee or advertising revenue rather than a trading margin. Classified and auction platforms such as OLX, Quikr and eBay's classifieds are the standard examples. Option A, B2B or business to business, covers trade between firms, as on IndiaMART or Alibaba, where a manufacturer buys raw material or components. Option B, B2C or business to consumer, is the familiar retail model in which a company sells directly to the shopper, as Amazon and Flipkart do. Option D, G2C or government to citizen, covers public services delivered online, such as railway ticketing through IRCTC or an online passport application. Identify the model by naming the two parties first, then matching the letters.

The correct answer is B, the National Payments Corporation of India. NPCI, set up in 2008 as the umbrella organisation for retail payments in the country, built and runs UPI, which lets a user link several bank accounts to one mobile application and transfer money instantly using a virtual payment address, without sharing account numbers. NPCI also operates RuPay, IMPS, AEPS, the *99# USSD service and the BHIM application released in 2016. Option A, the Reserve Bank of India, is the regulator that authorised and oversees NPCI and the payment systems, but it does not operate UPI itself; the distinction between regulating and operating is the trap in this question. Option C, the State Bank of India, is only one of the member banks on the network. Option D, SEBI, regulates the securities market and has no role in retail payments. Remember the pairing: RBI regulates, NPCI operates.

The correct answer is A, commercial transactions carried out through wireless handheld devices. M-commerce, or mobile commerce, is the part of electronic commerce conducted on smartphones, tablets and even feature phones over a wireless network, and the term is credited to Kevin Duffey in 1997. Because the device is personal, portable and location-aware, m-commerce supports mobile banking, mobile ticketing with a QR code, scan-and-pay at a counter, contactless NFC payment, hyperlocal delivery and in-app purchase. Option B describes Electronic Data Interchange, or EDI, the older standard by which firms exchange purchase orders and invoices between their computer systems. Option C is government to government dealing, usually written G2G, which is part of e-governance rather than of mobile commerce. Option D is simply advertising through a mass medium, with no electronic transaction at all, and advertising is only one activity that may support commerce.

The correct answer is A, SSL or TLS encryption. HTTPS is HTTP carried inside a protected channel: the browser and the server first exchange a digital certificate and agree on keys, after which card numbers, passwords and addresses travel as cipher text that an eavesdropper on the network cannot read. The older protocol was Secure Sockets Layer (SSL) and the current one is Transport Layer Security (TLS), which is why both names appear in textbooks and why the padlock icon is shown in the address bar. Option B, SMTP, is the protocol that carries outgoing e-mail and has nothing to do with web security. Option C, static IP addressing, merely means a device keeps a fixed network address; it does not encrypt anything. Option D, SQL, is the language used to query databases, and a careless implementation of it is itself a security weakness known as SQL injection. For an online payment, HTTPS plus a one-time password is the minimum a shopper should expect.

The correct answer is B, public procurement of goods and services by government buyers. GeM is an online marketplace on which central and state government departments, public sector undertakings and other public bodies buy common-use goods and services from registered sellers, with the aim of making purchase faster, cheaper and transparent. In the vocabulary of the chapter it is a business-to-government, or B2G, platform, and it also carries features that reserve part of the demand for small enterprises and women-led units. Option A is wrong because income tax returns are filed on the income tax department's own e-filing portal. Option C describes IRCTC, which is a government-to-citizen service for railway ticketing. Option D, company registration, is done through the corporate affairs ministry's MCA portal. Keep GeM distinct from ONDC: GeM is a government buying platform, while ONDC is an open protocol meant to connect buyers and sellers across different private applications.

The correct answer is B, B2B, business to business. On such a platform both the buyer and the seller are enterprises: a factory sources raw material, components, machinery or packaging from suppliers, and the orders are usually bulk orders with negotiated prices, credit terms and long-term supply contracts. Alibaba is the best known international example and IndiaMART and TradeIndia are Indian ones. Option A, B2C, is retail selling by a firm to an individual shopper, as on Amazon or Flipkart, where quantities are small and the price is displayed and fixed. Option C, C2B, reverses the usual direction: an individual supplies a service or content to a business, as a freelance designer, consultant or stock photographer does. Option D, B2E, business to employee, is an internal system through which an organisation serves its own staff, for instance a portal for leave, claims or training. The volume of B2B trade worldwide is far larger than that of B2C, a fact papers sometimes test directly.

The correct answer is B, the Information Technology Act, 2000. This Act is the legal foundation of electronic commerce in India: it recognised electronic records as equivalent to paper records, gave digital and later electronic signatures the status of a signature, provided for certifying authorities, and created the offences under which online fraud such as identity theft and cheating by personation is charged. Without that recognition a contract formed by clicking a button on a website would be difficult to enforce. Option A, the Indian Contract Act, 1872, still supplies the general law of offer, acceptance and consideration, but it predates computers and says nothing about electronic form. Option C, the Consumer Protection Act, 2019, matters a great deal to online shoppers and is the parent of the Consumer Protection (E-Commerce) Rules, 2020, yet it governs unfair trade practices and redressal, not the validity of electronic records. Option D, the Competition Act, 2002, deals with anti-competitive agreements and abuse of dominance.

The correct answer is A, Electronic Data Interchange. EDI is the computer-to-computer exchange of standard business documents such as purchase orders, invoices, despatch advices and payment instructions, in an agreed format, without paper and without a person re-typing the data at the other end. Large firms and their suppliers have used it since the 1960s and 1970s, which is why EDI is treated as the ancestor of modern e-commerce; the standards usually quoted are ANSI X12 and the international EDIFACT. Its advantages are speed, lower cost and the removal of typing errors, and its drawback was the expense of the private networks it originally needed. Options B, C and D are invented expansions of the same three letters, the usual way abbreviation questions are set, and none of them is a recognised term in commerce or computing. Learn EDI along with the other abbreviations of this chapter: UPI, NPCI, ONDC, GeM, PCI DSS, PPI, AEPS and USSD.

The correct answer is B, Open Network for Digital Commerce. ONDC is not an application or a marketplace but a set of open protocols, in the same spirit as UPI in payments, designed so that a buyer using one application can discover and order from a seller registered on a different application. The purpose is to break the lock-in of a platform, in which a seller must join each marketplace separately and accept its terms, and to bring small shopkeepers, artisans and local retailers into online trade at low cost. It is promoted by the Department for Promotion of Industry and Internal Trade under the commerce ministry, was incorporated as a private non-profit company and moved from a pilot into wider use in phases. Options A, C and D are invented expansions. Keep the three platform names separate for the exam: UPI for payments, ONDC for commerce discovery and GeM for government procurement.