Payment authorization provider takes to Net

JAKARTA (JP): PT Cipas Indonesia, the country's first credit card authorization service provider on the Internet, formally launched its operations on Thursday.

Company president Hagus Santoso said he was optimistic the firm would be able to lead the development of credit card authorization services on the Internet in the country.

He said prospects for electronic, or e-commerce, were high because of the country's sizable population.

Hagus said the number of Internet users, which at present is only about 3 percent of the total population, would rapidly grow in line with economic improvements.

He said the growth rate of the number of Internet users in the country reached 20 percent last year.

Cipas Indonesia is an information technology firm jointly owned by PT Rajawali Tri Manunggal and Cipas.com Sdn Bhd of Malaysia.

PT Sejahtera MBf Multi Finance, an issuer of credit cards, signed up on Thursday as Cipas' first client.

"Credit card holders would be charged between 4 percent and 8 percent of the value of their transaction done on the Internet," Hagus said after the signing of the agreement.

He said the service rate was dependent on which financial institutions, or credit card issuers, were used.

As a payment authorization service provider, Cipas provides a link between the credit card issuer and the merchants who sell their goods or services on the Internet. The credit card issuer pays an annual fee for the company's authorization service.

With the authorization service, any merchant will instantly know whether a purchaser has a valid credit card for the particular amount of the transaction. (udi)