CyberCoin FAQ

Consumers using CyberCoin

1. What is the dollar range of transactions that CyberCoin can be used for?

   CyberCoin can be used for microtransactions, or small denomination purchases, on the Internet ranging from $0.25 - $10.00 and up.

2. Does it cost the consumer to use CyberCoin?

   There is no cost to the consumer for using CyberCoin, the electronic Wallet or any of CyberCash's other services.

3. What is the electronic Wallet?

   The Wallet is a free graphical software program that is installed on a consumer's personal computer and provides a vehicle for secure, instantaneous transactions between consumers, merchants and their banks. The Wallet has an easy-to-use graphical look and feel and currently supports multiple credit cards including Visa, MasterCard, American Express and Discover. A transaction log also records all Wallet activities.

4. How does a consumer get a Wallet?

   Consumers will soon be able to download a branded bank Wallet from participating bank and merchant sites. CyberCash Wallets can now be downloaded directly from the CyberCash web site at http://www.cybercash.com. Once a Wallet is downloaded, cash can be transferred from the consumer's checking account or from their credit cards into their Wallet.

5. Can a consumer use his/her existing bank account with CyberCoin?

   Yes. CyberCash created the CyberCoin service to allow a consumer to use an existing bank account to transfer money to their Wallet. Banks supporting CyberCoin provide the accounts which "hold" the money transferred to the Wallet; enabling the money transferred to remain within the banking networks. However, these banks do not require an account to be set up with them.

   This funds transfer process is similar to the process one goes through when receiving a credit card from a bank other than one's regular bank. While one doesn't have to have an account at the card issuing bank, the banking networks facilitate the payments seamlessly.

6. Once a consumer has a Wallet, how does he/she connect his/her current bank account to it

   Once a consumer downloads a Wallet, s/he will walk through a simple and brief process to register their existing checking account and bind it to their Wallet. While this registration process is occurring, the system is instantaneously confirming the validity and authenticity of the person, the account and the connection between the two.

7. What are typical purchases using the CyberCoin service?

   The CyberCoin service facilitates internet transactions generally below $10.00. Typical purchases will initially include business research, micropublishing (newspaper articles), pay-to-view or pay-to-play transactions such as online gaming or online chat, software distribution, etc.

8. What platforms are the new CyberCoin-enabled Wallets available on?

   The Windows95 and 3.1 Wallet is available immediately for the consumer to download at the CyberCash Web site (http://www.cybercash.com). The Macintosh Wallet will be available in Q1, 1997, and will be available from the CyberCash Web site as well as participating banks.

   Merchant software is immediately available for free from CyberCash on the Solaris and BSDI platforms. Windows NT merchant software will be available Q4, 1996.

9. Does the money go into the consumer's PC?

   Money is never moved onto or stored on the consumer's PC. CyberCoin is a notational system. When the consumer transfers money into his/her Wallet, it is legal record of the money, but not the money itself. The money stays safely within the confines of the existing banking networks.

10. What happens to a consumer's money if the hard disk crashes?

    The money is returned to the consumer's checking account upon the bank being notified of the crash. If the computer containing the Wallet crashes, the consumer contacts customer service, gives a previously defined verification identification, and the money is automatically transferred back into the consumer's bank account.

    CyberCash's notational system is a representation of the money, while a tokenized system is the real e-money being moved. When money is moved with CyberCoin, it is "noted" by existing banking networks and deducted or added to the proper account. At the close of each business day, the true funds are reconciled within the existing banking networks, similar to the ways accounts are managed today.

11. Is there a limit to the amount of cash a consumer can put in his/her Wallet?

    Yes, you can load up to $80 over one month.

12. Can a consumer use CyberCoin anonymously?

    The CyberCoin system is completely private, but it is not "anonymous" - the consumer always has a record of his/her transactions and can prove them but the merchant will not know the consumer's identity unless the consumer reveals it. As a consumer is not asked to show an ID when purchasing an item with cash in the real world, it is the same when making a purchase with CyberCoin on the Internet.

13. What information is being encrypted?

    In a CyberCoin transaction, the financial information is encrypted and digitally signed, but the message itself is not. This encryption process allows CyberCash to offer industrial strength security worldwide.

14. Can a consumer use the CyberCoin service or the Wallet at a non-CyberCash-enabled merchant site?

    No. To use the CyberCoin wallet services, a consumer must be shopping at a CyberCash-enabled merchant.

15. Is the CyberCoin system federally approved?

    Funds in the CyberCoin system are FDIC insured. For the consumer this guarantees that if the CyberCoin issuing bank goes out of business, the consumer's money is insured by the Federal government.

16. How does the consumer take money out of his/her Wallet?

    Consumers can transfer money out of the Wallet as simply as it is transferred in through a simple click-through process. The consumer determines the amount of money he or she wishes to move, decides which DDA account the money will be transferred to by clicking on it, and the funds are immediately put back into the account. Consumers, however, can not move money into someone else's account or onto a credit card.

17. Does the Wallet keep a "receipt" or transaction log of a consumer's purchases?

    The Wallet keeps a transaction log or "receipt" of every transaction ever made. These receipts act the same as any receipt in the physical world.

18. Once a consumer has paid, how can they be "assured" that they will receive their electronic goods?

    CyberCash confirms the delivery of both payment and goods through the use of public and private key encryption, one of the security measures in place. Until delivery of the goods has reached the consumer's computer through the transfer of the encrypted key, the funds will not be moved. When it is confirmed that the message digest has reached the consumer's hard disk, the money is instantaneously moved to the merchant's "CashRegister."

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    Banks and Merchants Using CyberCoin

19. Why would a bank be interested in offering CyberCoin?

    Offering the CyberCoin service allows banks to use their existing networks to create new revenue streams, develop brand awareness and extend customer loyalty, while cutting costs associated with these marketing efforts in the physical world.

20. Why would a merchant be interested in using CyberCoin?

    CyberCoin offers the merchant a cost-effective means to capture the casual and spontaneous sale - which some estimate as high as 80-90% of the Internet digital goods market. With CyberCoin, merchants can offer customers a choice of subscription or pay-per-view and thus expand their market.

    Merchants can use CyberCoin as their primary transaction means or as a complementary payment model to an already existing model on their Web site.

    CyberCoin is used by merchants to offer lower-priced items such as software, services, information, graphics, games, music and Web access, and other items that can not usually be purchased with a credit card. CyberCoin also makes pay-per-view and pay-per-transaction models possible.

21. Is CyberCoin SET-compliant?

    SET is a credit card standard and as such is not applicable to CyberCoin. CyberCash supports the recently proposed standard for Secure Electronic Transaction (SET) over the Internet, announced by VISA and MasterCard. When SET is established, CyberCash is committed to being one of the first SET-compliant Internet payment services available.

22. What is the CyberCoin business model?

    CyberCoin services will be distributed through banks, who will offer online merchants the CyberCoin service and offer consumers co-branded Wallets. The merchants pay the bank a per-transaction fee to use CyberCoin. This fee will be a tier-based pricing model based on the transaction size. The bank will pay CyberCash a transaction fee for providing the technology and processing service.

    The merchant can find new revenue channels with CyberCoin because it can now offer services and goods at low and incremental costs that were previously prohibitive because the pricing models of credit cards were ineffective with low-cost items. The merchant, with a very low cost of digital goods, can profitably charge on a per-transaction or per-view basis.

23. What security features are in place to protect consumers, their money and transactions?

    CyberCoin uses the most advanced security features for consumers, banks and merchants. When a consumer binds, or connects, their checking account to their Wallet, CyberCash confirms three things: that the person is who they say they are; that the account is a valid and active account with money in it; and that the person is connected legally to that account.

    Once confirmed, CyberCash protects the consumer through the use of 768-bit RSA encryption with the password-protected Wallet. CyberCash is also working with VeriSign to incorporate Digital IDs for instantaneous validation of an individual and merchants identity.

24. Can CyberCoin services be used outside of the US or with foreign merchants?

    CyberCash is working towards a solution to support global currency transactions. However, CyberCash currently offers purchases made only with U.S. dollars and at online merchants who have a US bank account.

    Eventually, CyberCoin will be able to be used outside the US with any foreign or International bank that is a CyberCoin issuing bank. When a consumer buys a good or service on the Internet listed in foreign currency, the system will translate the currency on-the-fly with the exchange rate guaranteed by a bank, and the debit will occur in the consumer's domestic currency. Consumers will also be able to hold a number of different currencies in their Wallet, similar to the way funds are held in the physical world.

25. How do the bank's role and CyberCash's role differ?

    Banks provide the marketing and financial systems for actual holding and transfer of funds, while CyberCash provides the bank with technology and processing services.

    CyberCash will also work with banks to promote the bank's brand and the bank's Wallet.

26. When does the wallet appear during a transaction?

    The Wallet is a helper application that is automatically launched when the consumer clicks the "Pay" button on a merchant's Web site. The essence of the Wallet consists of a set of transaction files and the consumer's digital identification. These unique identifiers allow the consumer to log-in and use their Wallet at any PC that has the basic Wallet software loaded on it.

27. Can CyberCoin be used for peer-to-peer transactions?

    CyberCoin is not a peer-to-peer solution between individual consumers on the Internet. CyberCash's electronic check services will offer peer-to-peer transactions. It will be available in 1997.

28. What is Regulation E and why is it important that CyberCoin is Regulation E compliant?

    Regulation E is the rule governing electronic funds transfers. It is intended as a consumer protection rule to help guard consumers against losing money from errors or fraud in electronic funds transfers. It requires written advance authorization for arrangements to move money electronically, written receipts for every transfer, a written periodic statement, giving the consumer the right to challenge any electronic funds transfer for a period of 30 days from when they get their statement. Financial institutions offering EFT have a duty to investigate any challenges and respond within a short time (usually 10 days). CyberCoin is Regulation E compliant.

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