ELECTRONONIC PAYMENT SYSTEMS IN GHANA

CHAPTER ONE: INTRODUCTION Research Background It has become increasingly clear that the use of technology in todays businesses is inevitable. This is because new IT business opportunities, as well as threats, are coming at a faster and faster rate (Reynolds p.4). This upsurge in the use of information and communication technology in businesses today has been attributed to two broad causes, demand and supply, by Graham and David. On the demand side they wrote the complexity and volatility of market forces mean that businesses require more targeted and more current information to gain a competitive advantage and survive (Graham&David, p.2) and on the supply side the development of faster, cheaper and more flexible technology for information processing (computers) and information transmission (telecommunications) has enabled the information sector to grow ((Graham&David, p.3) The application of the technology in the business world has become a major trend in practice and generated a hot stream of research/debate both in industry and the academia. (Petten, 2009) wrote the evolution of ICT has kept researcher and practitioners alike busy. This trend is expected to continue with an increasing intensity every year (p.50). Since its introduction and use in the corporate world, information technology has changed its shape and form and continues to change as various aspects of business are streamlined to facilitate automation. Various information systems are used to facilitate business processes, mass use of the internets across the diverse functions of organisations, the use of databases and database systems are among other forms that quote most firms today are gravitating towards the digital firm. The reach of

digital technologies is vast and wide. Technology touches your personal life every day. Equally so, digital technologies have dramatically altered the competitive landscape of business. Fifty of the Fortune top 500 companies in 2006 (thats one in every 10) were digital technology companies (Haag & Cummings, p. 4). Though with its concomitant shortcomings, the deportment of technology has innumerable gains that are viewed to surpass its shortfalls. According to Laudon and Laudon (2012) the increasing investment in technology is to reach six businesses ends: operational excellence; new products, services, and business models; customer and supplier intimacy; improved decision making; competitive advantage; and survival. One business model which has gained much ground in contemporary and facilitated by technology is e-commerce. The backbone of this e-business is electronic payment.

Research Problem It is not uncommon these days to walk into a shop which has electronic payment facilities; though on a broader scale consumer purchases are still on cash bases. For instance The reality of the current UK payment system is that it is primarily paper based with more than 80 % of all individual payment transactions taking the form of cash payments, cheques or other paper credits. (Cred, p.29) The inertia in adopting e-payment by majority of the consuming public, which has delayed the transformation of payment systems, is attributable to various factors. Hence the role of government in hastening the transformation process must be emphasized While the

move towards electronic money appears to be unstoppable, the speed of change will depend on the ability of governments to put in place - in cooperation with e-money issuers, merchants and consumers - a favourable legal and regulatory environment (Andrieu, p.503). In the near future, with all firms gravitating towards the digital firm, retailers as well as buyers of retail goods must come to terms with this emerged phenomenon without hesitation. As Andreas (1998) puts it, The future vision is of increasing volumes of business transacted on the Internet using electronic methods of payment and eventually electronic money in the form of electronic-cash (p. 26). Whiles retailers will have to embrace electronic payment due to their desire for higher levels of profit, consumers risk in carry cash around and the convenience of holding cash in cards makes a stronger case for e-payments.

Research Purpose The purpose of this study is to evaluate the impact of electronic payment systems, some emerging issues as well as challenges of its applications in the retail business sector. To analyse existing payment systems and to propose an improve framework for efficiency in electronic payment.

Research Objective This study seeks to investigate the influence of electronic payment systems on nontraditional shops-who have adopted electronic payment technology as against their counterparts, the local market sellers-who do not have this technology. And to investigate the challenges with existing electronic payment systems

Research Questions

What is the process involved in initializing and completing an electronic payment in

shops?

What are the challenges of electronic payments in Accra?

How has electronic payment affected business sales in retail shops?

Research Methodology Qualitative methodology will be adopted for this study as it provides thick, rich description of people and situations being studied, captures what actually takes place and what people actually say, and provides pure description of people, activities, interactions, and settings (Lofland, 1971). Specifically, the case study approach will be used. Two retail outlets with different sizes will be looked at ShopRite and total mart. The case study approach will be used because

Electronic payment is still viewed as an emerging phenomenon and has not permeated the commercial constituencies deeply. Hence the population universe and sample will be too small for any efficient quantitative analysis. Time constraint is a factor for the choice of case study. But most importantly, as (Zikmund et al.., 2011) puts it, a primary advantage of the case study is that an entire organization or entity can be investigated in depth with meticulous attention to detail. (p.140). The population of the study is all consumer retail shops in Accra, from which the sample frame, consumer shops in the Ga-East Municipality, was chosen. The sample elements were chosen via a nonprobability sampling specifically using convenience sampling. Data was collected using multiple methods such as observation, interview and questionnaires.

Significance of Research The significance of this study has be categorized into three: Research- previous work by other researchers on the topic has generally tended to unearth the cause of the low proliferation of e-payment in the Ghanaian society. Or to sugeest way in which the adoption of epayment will benefit the economy. However, this study is moving away and beyond what most of the previous research has sought to address in that it is aimed at conceptualizing the current processes adopted by retailer and buyers who use electronic cards for their transaction and to develop a new model which will arrest the bottlenecks associated with what is currently being done.

Practice- practically, the results of this work will be a useful literature for business as well as policy maker who might consider e-payments in the line of their operations and functions. Secondly it will be a significant document for firms wishing to adopt epayment systems as into their business process and to old firms (those already accepting epayments) which wish to upgrade and improve their existing processes. Policy- this study will enable policy makers, such as the bank of Ghana-whose Ezwich launch could not catch up with the purchasing public till date, get a clearer understanding of what actually goes at the sales points so as be informed about weakness that may affect for instance tax preparations as well as the much talked about nationwide cashless economy vision.

Research Limitations The research could not look at those retail outlets that do not accept electronic cards. The response of these groups of people could have been of immense use in explaining why the pace of epayment in Ghana has been sluggish. More so, the research will not include any interaction from buyer who are direct parties to any e-payment process. Furthermore, the outlets did not keep structured data on epayments-such data, if available, could have been an immense source of trend analysis and historical inference.

CHAPTER TWO: RESEARCH METHODOLOGY

Research Framework
The theories explained in this chapter deals with the how and why retailers adopt electronic payment and whether this can alleviate some of the problems inherent in the traditional payment schemes (i.e. cash payment). As explained earlier in this study, there are no single or widely accepted theories that explain the adoption of electronic payment instruments. We will develop our own theories which would be used to analyze how electronic payment mechanisms have been adopted in shops and whether it has reduced or eliminate the problems associated with cash payments in Ghana. Payment methods based on electronic instruments have undergone many changes recently. This chapter will also provide a brief overview of the recent trends and map the current situation.

Definitions of Electronic Payment Systems

Due to the nature of electronic payment systems, there have not been a widely or universal definition for it. But we have attempted to bring some few notable definitions given some writers. These range from now-familiar automated teller machines (ATM) to Internet bill payments. According to Humphrey et al (2001), electronic payment refers to cash and associated transactions implemented using electronic means. Typically, this involves the use of computer networks such as the Internet and digital stored value systems. The system allows bills to be paid directly from bank accounts, without being present at the bank, and without the need of writing and mailing cheques. E-payment can be defined as payment by direct credit, electronic transfer of credit card details, or some other electronic means, as opposed to payment by cheque and cash. (Agimo, 2004) It was also defined as a payers transfer of a monetary claim on a party acceptable to the

beneficially. (European Central Bank, 2003) According to Kalakota & Whinston (1997, p. 153), electronic payment is a financial exchange that takes place online between the seller buyer and the seller. The content of this exchange is usually the form of digital financial instrument (such as encrypted credit card numbers, electronic checks, or digital cash) that is backed by a bank or an intermediary, or by a legal tender. For the purpose of this thesis, the term electronic payment refers to as convenient, safe, and secure methods for payment of bills and other transactions by electronic means such as card, telephone, the Internet, EFT, and etc. Electronic payment gives consumers an alternative to paying bills and debts by cash, cheque, money order, etc. Its main purpose is to reduce cash and cheque transactions. According to Pariwat & Hataiseere (2004), for the achievement of effective and efficient retail payment systems, the following considerations that shape the choice of payment method for consumers and businesses should be taken into account; the convenience, reliability and security of the payment method, the service quality, involving such features as the speed with which payment are processed; the level and structure of fees charged by financial institutions; taste and demographic; and technological advances which have improve the speed, convenience and flexibility of different payment systems.
Customers Wealth/Levels of Income

Consistent with Kwast and Kennickell (1997) research, wealth has an important role to play in terms of consumers decisions on payment choice. Consumers wealth may influence payment choice and the availability of payment instruments that one can choose. For instance, while wealthy consumers may be able to fund their obligations generally, consumers that experience brief financial shortfalls may not find electronic bill payment desirable as a payment instrument. (Mantel, 2000) In such a situation, the
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consideration of the risk factor will let some consumers to avoid using pre-authorized electronic bill payment.
Educational Level

On the bank customers survey, we also focused on education, because this might affect the demand for electronic banking products. For example, Kwast and Kennickell (1997) have illustrated how education play important role in determining household use of emoney products. Kwast and Kennickell concluded that the US market for such products is still highly specialized, with the demand coming almost entirely from higher income, younger, and more educated households that have accumulated significant financial assets. Educational levels of customers determine whether consumers will adopt electronic payment or not. Studies have shown that highly-educated people patronize electronic payment products than less-educated people. The technicalities involved in some electronic payment transactions discourage less educated customers to patronize its use. (Annon, 1999)

Employment Levels
Those employed who receive their pay through the banks are more likely to use electronic means of payment. Employees, through their constant contacts with banks are more exposed to payment products, and are therefore, likely to patronize the products. According to Ferguson (2000), more than half of the workers in the US, in 2000 receive a direct deposit of their pay through the Automated Clearing House (ACH).
Personal Preferences

Another factor influencing payment instrument choice pertains to customers personal preferences. The following six general consumer preferences were identified: (1) control
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and customer service; (2) budgeting and record keeping; (3) incentives and low cost; (4) convenience; (5) safe, easy and convenience; and (6) privacy and security. In our analysis of the empirical data, we may highlight these preferences but not in detailed.

Card Payments Automated Teller Machine (ATM)

ATM is a combined computer terminal, with cash vault and record-keeping system in one unit, permitting customers to enter the banks book keeping system with a plastic card containing a Personal Identification Number (PIN). It can also be accessed by punching a special code number into the computer terminal linked to the banks computerized records. (Rose, 1999) Mostly located outside of banks, it can also be found at airports, shopping malls, and places far away from the home bank offices, and offering several retail banking services to customers. First introduced as cash dispensing machines, it now provide a wide range of services, such as making deposits, funds transfer between two or more accounts and bill payments. (Abor, 2004)
Electronic Purses/Wallets There are two categories of e/wallet, these are;

a) E-wallets that store card numbers. This is a virtual wallet that can store credit card and debit card information. Other information that can be stored on this card is passwords, membership cards, and health information. Some of the e-wallets make it easier for consumers to buy goods using the card. (Rudl, undated)

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b) E-wallets that store card numbers and cash. The second category of a digital wallet is where Introduced more recently, debit together with credit cards represent the most rapidly growing method of payments in several OECD countries. (Pierce, 2001) When a payment is made through a debit card, the funds are immediately withdrawn from the purchaser's bank account. The advantage is that the buyer has the funds to make the purchase and paid for right away, so there's no credit card shock when the statement arrives in the mail. (Pierce, 2001)

Smart Cards

A smart card is a plastic card with a computer chip inserted into it and that store and transacts data between users. (Smart Card Basics, 2004) The data, in a form of value or information is stored in the cards chip, either a memory or microprocessor. Smart cardenhanced systems are in use today throughout several key applications, including healthcare, banking, entertainment and transportation. (Smart Card Basics, 2004) One of the features of this card is that it improves the security and convenience of transactions. The system works in virtually any type of network and provides security for the exchange of data. (Smart Card Basics, 2004)

Electronic Funds Transfer at Point of Sale (EFT/POS)

EFT/POS is an online system that involves the use of plastic cards in terminal on merchants premises and enables customers to transfer funds instantaneously from their

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bank accounts to merchant accounts when making purchases. It uses a debit card to activate an EFT process. (Chorafas, 1988) It actually comprises two distinct mechanisms: debit and credit cards.

Credit Cards

This is a plastic card that assures a seller that the person using it has a satisfactory credit rating and that the issuer will see to it that the seller receives payment for the goods or items delivered. This represents the automated capture of data about purchases against a revolving credit account. (Pierce, 2001)

Debit Cards

These were a new form of value-transfer, where the card holder after keying of a PIN, uses a terminal and network to authorize the transfer of value from their account to that of a merchant. Introduced more recently, debit together with credit cards represent the most rapidly growing method of payments in several OECD countries. (Pierce, 2001) When a payment is made through a debit card, the funds are immediately withdrawn from the purchaser's bank account. The advantage is that the buyer has the funds to make the purchase and paid for right away, so there's no credit card shock when the statement arrives in the mail.(Pierce, 2001)

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Online/Internet Payments

This is the means by which customers transact business with a bank through the use of the Internet network. Customers can access their bank accounts and make transfers through a web site provided by the bank and complying with some rigorous security checks. The Federal Reserve Board of Chicagos Office of the Comptroller of the Currency (OCC) Internet Banking

Data Collection and Analysis The study sought to evaluate the effectiveness of how electronic payments are effected (done) at various pay points across the capital as well as its contribution to the bottomline of retails and what challenges hinder the success of electronic payments. The case study approach was used in order to obtain an in depth appreciation of the subject matter of electronic payments (Kalof et al.., 2008). Initial questionnaires were sent to the two respondents: these they complete and handed in within two days. The questionnaires created the foundation upon which the case study proper was built one week later. The respondents were chosen based on Principally, face-to-face semi-structured but open-ended interviews were used to collect data. Information acquired via personal observation was marginally used as well. This enabled us to gather empirical evidence and much confidence that the data we have collected is primary and reliable. The questionnaires were designed in such a wat as to give fore-knowledge to the respondents about the type of questions to expect during the interview. The questions on

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the questionnaire were open-ended and precise, a bit of bio data was also collected via the questionnaire. The sampling method used to choose A follow-up interview was conducted for the respondents via phone exactly three days after the face-to-face interviews. The purpose of this was to clarify some issues that came up during the preparation of the reports and to reaffirm some the issues addressed in the earlier interview. Two retail outlets were selected namely Shoprite, Accra Mall; Pills and Tabs, Legon.

The two were chosen due to the uniqueness of their similarities and discrepancies. But essentially the contrast between them is of is enormous capital to our finding as a creates a case for shops that bear their feature. Shoprite, Accra Mall is unarguable the most patronized retail outlet in Accra. It is the most popular destination majority of shoppers in the capital and the brand is virtually a household name. Pills and Tabs, Legon, unlike Shoprite, is a quiet small shop located at Legon, outside the University of Ghana. The flow of shopper traffic is very minimal and its popularity concentrated within its catchment area. It is these variations in patronage, popularity, size, that we wished to make incumbent in our study. The cases were then analysed for themes frequency (Zikmund et al,p.140)

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CHAPTER THREE: RESULTS AND FINDINGS Findings At the ShopRite, it was estimated that only about 9% of sales is accounted for by electronic payments while it is about 7.5% at Pills and Tabs. Hence on average 8.25 of weekly purchases was paid for by card. Shoprite estimated that about 90% of their card holding customers are not Ghanaian nationals while Pills and Tabs estimated same to be about 45%. Therefore on average, 67.5% of card buyers are foreign nationals. Generally, no formal training is conducted for persons designated to over the processing of electronic payments. That e-payment is not seen as a source of competitive advantage but rather considered as some extra service rendered to the benefit of customers alone. Consequently conscientious investment into the development of equipment and operations are largely nonexistent-that usually such equipment are provided by the card issuing institutions.

Case finding CASE ONE: We spoke to Miss B (pseudonym), a sales supervisor at Shoprite, Accra mall. Bio Data

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Name: Miss B Job title: Sales Supervisor Length of employment: 3years Educational level: Diploma in Business Administration

She disclosed that the process of e-payment starts upon completion of the selection of items by customers. The actual process of effecting payment from a customers card via a card reader is done by person other than the person sitting at the payment point who checks all items bought and receives payment. The procedure and type of receipt differs depending on the type of card Miss B disclosed that the card types frequently used by customer include (but not in any particular order) Ezwich, Visa, ATM Card, MasterCard. However, and upon further interrogation, we found out that operationally these cards are categorise into two. Thus we have 1. Those that carry the magnetic stripe- herein referred to as Swipe cards 2. Those that are accessible via a PIN - herein referred PIN cards Customer involvement in the processing of payments from swipe cards is minimal relative to the PIN cards. Passing the swipe card under the sensors of a card reader will reveal all the personal and financial details of the customer- and if the cashier is satisfied with the identification and financial details of the buyer, he/she proceeds debit the customer by the

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cedi value of the sale.to complete the payment process, two receipts are printed called 1st and 2nd receipts. The first receipt is kept by the shop and the second issued to the buyer. Upon the issuance of the second receipt to the customer, the purchasing process has effectually been terminated. However, she does not have record on which of these cards is most prevalently used since the company does not keep that statistics.

CASE TWO

Miss C is one of two sales persons at Pills and Tabs, Legon. Bio Data Name: Miss C Job title: Salesgirl Length of employment: 6 years Educational level: SSSCE TotalMart on the other hand is a much smaller shop compared to ShopRite and so the purchase process is simpler. At any point in time the shop keeps two employees who run daily shifts. They facilitate and implement all electronic as well as cash payments when on duty.

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The purchase process begins when a customer enters the shop to select various items of his/her choice and then. Miss B narrated that payment process begins when the customer presents the collected items to the cashiers desk. Incidentally, the shop shares the only card reader with the fuel station attached to it. This obviously causes delays to customers anytime the card reader is in use at the fuel station.

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Discussion of Findings In Figure A above, we illustrate a summary of the payment process as it pertains in the two shops as there are no existing designs. We structured the existing process into three activities namely PrePurchase Activity ProcessPurchase Activity PostPurchase Activity The PrePurchase stage involves all activities leading up the cashier picking the electronic card from the customer. The activities are

Selection of items from the shelves, Submission of items to the cashier Submission of appropriate e-card for payment
Once the cashier picks up the card from the customer, the next process effectively begins i.e. ProcessPurchase stage which involves:

Cashier swipes card or allows buyer to enter PIN Buyers details on the card verified Buyer account debited Receipt issued to buyer Duplicate receipt filed by cashier.

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The last stage of the process which effectively terminates the buying and selling process is herein referred to as PostPurchase and involves

Customer pick card from cashier Collects all items bought Checks account from card issuer
When a customer receives his account statement from the card issuer, he/she may be dissatisfied if there are inconsistencies between the receipt of purchase and the statement. To address this, the customer will have to report back to the shop to initialize a process of correcting the anomaly. See Figure B is an improvement of this existing system and our suggestion for effieciency in the electronic payment process.

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In this new and improved framework for electronic payments, the card issuing is an integral actor of the model. Whiles the role of the card issuers in electronic payments is vast in generality, in the specific case of the payment process, they come in seriously during the post purchase stage when a customer makes complaint. First of all, it is worth noting that the customer complaint may as well be sparked by the card issuer when they give periodic statement of account to the customer or perhaps the customers initiated this by themselves when they go to verify their account position after a purchase transaction.

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To simplify the process a typical consumer goes through to have his/her complaint address in regards to deductions his/her accounts the card issuer, who in the case is the customers account holder is included. As a result the customer has two options through which the complaint can be send to the system. This calls for a systemic collaboration between the records of the card issuers and the shops. This inclusion of the card issuers has several benefits for electronic payments in general in the following ways Reduces delays that arises if the customer will have to report at the shop after discovering any inconsistencies in their accounts, then there will be some delay before the account department of the shop communicates with the card issuerwho also delays before giving initial response. And even after all these preliminary delays more time is wasted before a possible rectification is effected. Convenience-depending on when and how the customer discovered the complaint, he/she has the option to choose where to lodge the complaint i.e. the shop or the bank. The complaining is also internet and telephone enable-this further option adds up to the level of convenience enjoyed by the customer; Reassurance- provides reassurance to clients that the involvement of all the major stakeholders in the purchase process means that the safety and security of their transaction is guaranteed; Cost incurred by customer to go back to the shop to make the complaint also reduces the numerous follow-up calls and visits.

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Like in fig. 1, the payment process is activated at the point of payment when a customer submits collected items to the cashier. As an improvement from the old system, specific booths are dedicated to card holding customers; this will ensure they do not join the long unwinding queues that develop in front of the normal cashiers. In the not too long run, such a demarcation will redirect the attention of some patrons to the use of electronic cards for payment. After the submission of the items the cashier quickly adds up the cost and begins to process the customers card. This is the next stage in the framework (fig 2) called card verification. The verification of the card depends, to some extent, on the type of card. After the initial verification which tries to prove authenticity and account level, and upon satisfaction, the cashiers send a request to the card issuer. Upon receiving clearance from the card issuer, the system move s to the next state i.e. printing of receipts. At this stage, a printout of items bought prices including all charges is generated and given to the customer. Here again, there is simplification if you compare with fig1. Only one receipt is printed out which is the one for the customer thereby eliminating the second receipt printed and filed by the cashier. The cashiers evidence of sales and payment is automatically entered into a database which accompanies the payment system. This speeds up the payment process and saves cost. Upon completion of this stage, the cashier then presses an exit button before attending to the next customer. Once this button is pressed, a summary of the payment details are forwarded into the accounts department automatically. This enables the accounts manager to track payment transaction by the minute.

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CHAPTER FOUR: CONCLUSION This study has covered some issues associated with payment transactions, instruments, and systems prevailing in the retail subsector in Accra. It contains a description and analysis of the electronic payment process and instruments from the viewpoint of the seller. Furthermore, it looked at the relational entities involved in a typical complete electronic payment process with an improved relational model for the enhancement of electronic payment process in Accra. Finally, it included a description of innovations in electronic retail payments in Ghana. As underscored earlier in this study, the electronic payment in Ghana over the years has been under patronised but is currently gaining a marginal popularity among certain classes of people but that transactions have remained highly paper-based. The results of the study shows that, on the average, sales via electronic payments have been very low compared to its cash based counterpart which evidence has been adduced for the low investment by shop into electronic payments and the inertia by most retail outlets to adopt epayments as well. This conservatism on the part of both sellers and buyers to embrace payments via electronic cards has deprived and continues to deprive individual consumers, businesses and the larger economy the numerous benefits associated with the electronisation of transactions. As the world around us is all going digital and international transactions becomes rampant retailing in Ghana must keep up with the pace and intergrate itself quickly into the bigger digital world one in which nearly all of the organizations significant business relationships with customers, suppliers, and employees are digitally enabled and mediated (Laudon & Laudon p.11 to).

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The system, therefore, must make a conscious effort to provide innovative, simple and efficient electronic payment solutions that can entice both buyers and sellers to electronic payments and begin a revolution away from the age old cash only economy to the much talked about cashless economy. The role of commercial banks cannot be underestimated if the dream of creating a cashless economy is to be realized soon. As discussed earlier in this study, banks are the largest issuers of electronic payment cards hence any efforts targeted at improving electronic payment must recognize them as key stakeholder. Perhaps the two main challenges facing the electronic payment process in retail outlets is lack of publicity and inadequate training for processing staff. Which problems if dealt with, will be a first step toward removing the cloud of doubt which stifles consumer interest in electronic payment systems and compel sellers/retailers to want to go for the gains that accompanies electronic payment. We can conclude by saying that consumers have a propensity to show rational payment preferences and behaviours based on the analysis of the consumers survey. It was observed that consumers behaviours are consistent with their preferences, which vary but may include convenience, incentives, control, privacy, security, and personal involvement. The study showed that, one of the significant impacts pertaining to payment instrument choice on consumer decision-making is consumers financial positions and the nature of specific transactions.

If the right steps are taken, based on scientific market evidence, we are convinced that many people are going to flock to electronic payments as it becomes easier to use.

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Because of its ease of use, convenience and safety, it will be a credible alternative to the present phenomenon of cash. However the road to this destination does not look simple from afar and near because we still have a large chunk of Ghanaians who cannot use computer and so do not have any confidence whatsoever in the digital world. Additional, a greater majority of the population belong to the unbanked: according to the Chronicle newspaper only 5% of Ghanaians had bank accounts by 2004. Currents estimates puts the figure at about 27%- which is till way below what is desirable. Therefore, there is the need to create more awareness to entice the unbanked people into the banking system. The result demonstrate low user acceptance of existing payment products a pivotal factor in determining the success or failure of any payment system. An area that is worth for further research is, the role of commercial banks in changing consumer attitude towards electronic payments an enquiry into the reluctance of consumers to hold cash in cards

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RECOMMENDATION The use of cash for frequent transactions apart from the problems enumerated in this study, it is risky, costly and inefficient for consumers. It is also a source of competitive disadvantage to most businesses today. The need, therefore, to migrate from the use of cash to electronic payment instruments cannot be overemphasized. At the moment, most payment cards in Ghana utilize a magnetic stripe and need an internet connection to the issuing institution for the approval of transactions. This means that if the issuing institution is offline, the transaction will be denied. But the harsh reality in the capital, Accra and across the country, is that our retail outlets not connected to the world wide web: which makes magnetic stripe cards almost unpatronised. Considering the low level of technological infrastructure in Ghana, chip cards are best for the country because it has been successful in environments where the communication infrastructure is lacking. Chip-based payment products can bring payment to people who lack the infrastructure required for conventional magnetic stripe payments. Off-line technology is likely to succeed for some time in Ghana, because it is cheaper in an environment where there is no or very little any form of telecommunications. Government needs to ensure that the cost of telecommunications, hardware and software are made affordable, which will involve examining existing taxes and import duties. New technology and changes in the banking laws can produce change. Therefore, there is the need for the government to remove barriers to innovation, including regulatory barriers to pave way for rapid development of the electronic payment systems in Ghana. The emergence of electronic payment systems raises a whole range of both legal and regulatory issues that needs to be taking a look at. An effective national law value and

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regulatory framework to deal with digital business in general and electronic payments in particular will go a long way to removing what is currently a major obstacle to the expansion of general business activities. The emergence of an electronic payment system which is easy to use, cheap to process, and boost trade, is likely to have a range of only partly anticipated side effects. For example, it could result in the creation one currency for the Economic community of West African States (ECOWAS) which the countries are yearning for. There is the need for banks to get actively involved in the process leading up to the enlargement of electronic transactions. Banks should educate consumers about all of their payment system options and whip up confidence in active as well as would be users of electronic payment system electronic payments about the gains of changing to electronic payment systems. Consumers will need to be informed about the potential liability for the use of new types of electronic payment, so they can understand how it differs from cash. Although retailers in Ghana can learn valuable lessons from the experiences of retailers in other countries, the retail sub-sector must develop its own payment system. Simply importing another countrys electronic payment system without adjusting for geography, infrastructure, banking and legal structures, business practices, culture, and needs could lead to a suboptimal system.Thus framework (fig. 2) presented earlier in the study demonstrates the foundational parameters needed for any such systems and can be used as a generic prototype for design of electronic payment systems.

Shops should introduce their own cards

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Investments in e-payment systems Training of staff Reduce post purchase lag Reduce purchase lag Provide prepurchase information

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