BANQONIT is New Zealand’s leading internet-based electronic payment facility to the New Zealand banking system. BANQONIT provides a simple, secure and low cost mechanism for organization and individuals to validate and process credit card transactions in real time via the Internet.

It started late in 1997 as the first internet credit card transaction to be verified and cleared through the New Zealand banking system. Since then, it has achieved both rapid growth and enviable milestones in the e-commerce marketplace including the highest number of transactions in a single day, and the highest single transaction amount. There is a solid customer base with 30-40 active accounts currently.

BANQONIT was recently acquired by venture capital and management company zzinc.com. Other businesses under the zzinc.com ownership are yourpharmacy.co.nz, zzlongevity.com and NUBUZZ and Asparona.com. The companies leverage resources.

PROJECT AIM

The aim for BANQONIT project is to enhance the solution functionality and supportability of current system, also to add new features with an emphasis on security and scalability, in order to add value added benefits to the customers and the company.

PROJECT SCOPE

The general scope for the 2002 BANQONIT project is to review the existing software technologies platform and redesign where necessary with an emphasis on security, scalability and leveraging existing assets.

BANQONIT currently uses 4^th Dimension system (4D). The first stage of our project is to build specifications for new design features, which complies with the Microsoft technologies.

The second stage involves building the architecture, coding the software, author documentation. Also where the designing and implementing system test procedures occurs.

The last stage is to finalize system documentation, user guides and to place system in production.

CURRENT SYSTEM

At present, BANQONIT connects to the Bank of New Zealand over a virtual private network (hosted on the Internet) through a system called BuyLine. However, BANQONIT was developed in such a way that it can be connected to a number of different credit card processing agents with many different connections via multiple systems. In most cases a new connection to another processing agent should take no more than 24 working hours to complete. It is this very rapid scalability, which is one of the key features of BANQONIT.

MODE OF CONNECTION TO BANQONIT

1. Web Gateway

BANQONIT provides simple web site integration while still leaving the vendors in complete control of their own web site. When the customer is ready to complete their order and enter their credit card details they are directed to the BANQONIT secure server. BANQONIT then retrieves the order page from the vendor's web server and presents it to the user as a secure web page. When the customer submits the page it is passed securely back to BANQONIT, which processes the credit card and forwards the results along with the order details to the vendor's web server. A result page detailing whether the order was accepted or declined is returned from the vendor's web server to BANQ0NIT that forwards it to the user.

2. Email Gateway

With the e‑mail gateway, the user selects the products they want to purchase and enters their contact sand credit card details on the single web page that is once again forwarded through BANQONIT from the vendor web server or ISP. When the customer submits the page it is passed securely to BANQONIT, which processes the credit card and forwards the results along with the order details via e-mail to the vendor. If the order was processed successfully BANQONIT retrieves a web page for successful orders and forwards that to the customer, otherwise BANQONIT retrieves a web page for declined orders.

3. BANQONIT Direct

BANQONIT Direct provides a method for applications with TCP/IP capabilities to communicate to BANQONIT directly and complete a credit card transaction in a single connection. The connection uses standard HTTP protocols, which allows any TCP/IP capable programmer the ability to connect to BANQONIT. Included in the HTTP headers are the credit card details and the amount to charge. BANQONIT returns a standard HTTP response with details about the success or otherwise of the transaction.

4. Terminal Mode

Terminal mode provides a single secure web page that any BANQONIT client can access through an Internet connection and web page. Using the form on this page they can charge cards and perform inquiries on transactions. This allows anyone with a web connection to start processing real-time credit card transactions immediately, without any further work.

5. Bulk Up-Load

For BANQONIT clients that need to process large numbers of transactions but don’t need web site integration the bulk up-load interface allows them to process a whole file of transactions in one go. Bulk up-load is also accessed through a web browser and thus available to anyone with a web connection. BANQONIT can handle multiple different file formats, including binary files. New formats take up to 8 working hours to add to BANQONIT. The results of all transactions in the up-load are presented on a single page and these can then be saved to a file, once again in a variety of formats.

The bulk up-load interface means that any financial system that can export and import transaction files can be connected to BANQONIT very easily and rapidly.

6. BANQONIT Connect

This is an application that resides on a client’s machine that provides a secure connection to BANQONIT and a simple application-to-application communication framework. For a client who has a financial system that they want to use to process credit card transactions in real-time, BANQONIT Connect provides their system with a secure way to communicate to BANQONIT, without having to encode difficult encryption routines or install costly virtual private network software. BANQONIT Connect can receive data from the client’s system in a variety of ways, from up-loading files to copying data from the clipboard. Thus, even if the financial systems can only copy and paste data to or from the clipboard, it can communicate with BANQONIT securely.

USERS

BANQONIT is a business tool for existing or intending web merchants. It is also ideal for tele-merchants, mail order merchants, and fulfilment houses seeking real time or batch mode verification and payment of credit card transactions for businesses or individuals involved in e-commerce or who process orders received by mail, telephone, fax or the Internet.

FEES

There are 3 ways BANQONIT customers can pay for their BANQONIT service. The

Premium account is the mostly popular charging a sign up fee of $1100 + GST. Thereafter the fee is a 0.8% of the transaction.

The other two accounts are pay as you go. Around $100 per month charge.

COMPETITORS

1. ETSL Banks

Provider of the EFTPOS network. Strong financial relationship with four major banks of ASB, Westpac, ANZ and ANB. Their system is parallel to BANQONIT system but is further branded and website is more user friendly. They provide refunds and better authorisation for transactions however does not offer the multi-currency BANQONIT offers. The charge is $80/month + set up.

2. Transact

Uses the same BNZ BuyLine BANQONIT uses to integrate customer’s website application. They have no fees but instead a $3500 + integration costs.

3. Direct Payment Solutions

Interface with the Eftpos network. They have a minimum plan of $50/month + set up fee.

4. Clear / Telstra

Uses the same system as Direct Payment Solutions.

5. 2Day.com

Uses BuyLine with a $30/month plan + set up.

6. Payme.co.nz

Has a 10% fee / transaction, but instead a low set up cost.

MULTI-CURRENCY

BANQONIT offers a Currency Select feature to let the merchants choose from 16 different currencies to pay in. New Zealand merchants have had trouble selling to customers outside New Zealand at an acceptable cost with overnight settlement. The NZD is also not widely known internationally, which might result in mistrust. Research has shown that many customers would rather shop elsewhere than seek out a foreign exchange converter. These barriers are removed with the multi-currency feature.

This is a key feature, which differentiates BANQONIT from their competitors.

PROPOSED ENHANCEMENTS

There are 7 major areas identified to improve the current system’s functionality.

1. Refunds

Currently the BANQONIT system does not enable the clients to do their own refunds. Enhancements will be made to enable the clients to do their own refunds using the reference number of the transaction provided by BANQONIT.

2. Pre-authorization

To develop a feature which lets the client pre-authorize their customer’s cards before making the delivery to ensure that there are enough funds on the card.

3. Improved reporting

Provide the client with a more detailed useful transaction report upon request.

4. Graphical interface

Implement an interface that is user friendly, scalable and attractive.

5. Security

Extend an extra function to accommodate credit card pin numbers in order to improve security. This is aimed to adjust to the upcoming law insisted by major credit card companies by April 2003.

6. Code translation and architecture

Translate from the existing environment and architecture to a more scalable and comprehensive one with sufficient documentation.

7. Protocol

To find a protocol that will encapsulate BANQONIT’s applications for more consistency and security.

PROPOSED SYSTEM

The proposed solution to the BANQONIT project is to implement a 3-tier architecture system preferably using new Microsoft technology e.g. .NET (Visual basic, C Sharp or ASP) or java sun technologies like java, jsp’s and servlets technologies. This will be achieved by:

First, converting the existing Database Management System (4^th dimension system) to a Microsoft based one, for example SQL. This will be achieved by using the 4^th dimension assistant tool that translates all the current 4D database tables to SQL database schema. SQL database schema will improve functionality of the system by enabling the use of querying capabilities and allowing the use of Microsoft and java sun technologies to interact with the SQL databases using ODBC connectivity.

Second, we shall design an application manager that will include functions to maintain and manipulate data out of the relational database schema. This application must be able to communicate with the existing BNZ BuyLine System as well as other equivalent BuyLine applications from other banks, which will provide validating and processing of transactions, It must also provide functions for the current BANQONIT system e.g. batch files uploads, viewing past transaction reports etc, and for proposed enhancements e.g. customer refunds, Pre-authorisation etc.

Then we well designing an interface that uses the functions implemented in the application manager to maintain and process data. The interface will enable the customer with all the current functions of the BANQONIT system plus the proposed enhancements. It must also have a secure, easy to use Graphical User Interface.

Next, A BANQONIT web based management tool will be designed and implemented for the BANQONIT management team to easily maintain and monitor their clients’ transactions.

Through out the process, since we are dealing with banks and credit cards, our number one priority will always be security. We are thinking on implementing a protocol that provides high security and consistency for the BANQONIT system. At the moment we are considering Secure Electronic Transaction (SET) Protocol, which uses cryptography to:

1. Provide confidentiality of information

2. Ensure payment integrity, and

3. Authenticate both merchants and cardholders.

These specifications of the SET protocol will enable greater payment card acceptance, with a level of security that will encourage customers and businesses to make wide usage of payment card products in the electronic market. However this protocol will not be considered as a secure solution until further research.

We are also considering SUN J2ME technologies to enable clients and their customers to get access to the system and check transactions using wireless devices like WAP and cell phones.

Figure-1 represents the proposed system architecture:

Figure-1

TARGET BUSINESS BENEFITS

The newly designed architecture for BANQONIT will provide the following benefits:

A consistent and secured protocol between the main six components of the system. (Customer, customer bank, device, merchant, merchant bank and branding bank)
Further security over credit card transactions by enforcing security pin number.
Ability to refund transactions without explicit details exposed.
Better and more appealing website design concentrating on user friendly and flexibility.
User can now check credit card limit and hold the merchandise charge until actual merchandise has been sent.
Users can now receive detailed report on transactions upon request.
Implemented value added features will attract further customer in both domestic market and overseas markets.
Extensible system enabling future enhancements.

OTHER POSSIBLE ENHANCEMENT OPPORTUNITIES

On top of the proposed system, the project members have come up with further enhancements to improve the current system. These enhancements will be seized if opportunity arises.

1. Additional credit card

At the moment, clients had to have a BNZ account to be able to use the BANQONIT system. Enhancements will be made to let customers globally with accounts other than BNZ to use the system, e.g. ASB, ANZ, Westpac, NAB etc.

2. Payment through Email

Allow clients using a peer-to-peer transaction system to send payment by email gateway.

3. Payment through Mobiles

Allow clients and their customers to use Wireless devices for their payment transactions, i.e. WAP and SMS.

4. Online debit card payment

Extend system to be able to use debit cards.

BUSINESS ENHANCEMENT OPPORTUNITIES

Throughout our brainstorming, we have come up with the following business enhancement for BANQONIT system. This is out of the project scope however relates accordingly with the BANQONIT business environment.

1. Channel ownership

Extend the system by creating another income channel such as total integration of web design applications.

2. Branding

Enforce further marketing of the BANQONIT system to potential customers.

3. Telecom

Expanding the business to targeting customer Telecom

4. White label suppliers

A concept that gives the other companies the right to use the BANQONIT system under a different label.

SYSTEM PLATFORMS

The systems used for the development of the system are:

Database server:

Hewlet Packard x86 Family 6 Model 7 Stepping 3

590 Megabytes RAM

4 x 18.2 Gigabytes (ca 52 Gigabytes) Hard Drive Space

Microsoft NT 4.0

Application Server:

Apple G4 550-Megahertz Gigaflop

256 Megabytes RAM

9.56 Gigabytes Hard Drive Space

Mac OS 9

Terminal Server:

Dell Optiplex GX 110

Intel Celeron 660 Megahertz x86

130 Megabytes RAM

Development Machine:

Hewlet Packard

Intel Celeron 733 Megahertz

256 Megabytes RAM

20 Gigabytes Hard Drive Space

Microsoft Windows 2000

PROJECT ACTIVITIES

PROJECT IDENTIFICATION AND SELECTION

The 2002 INFOSYS340 project paper offered the students with a wide range of projects. The camp at Huia offered the opportunity for students to socialise with each other and understand each other’s skills in order to form a team with different specialised abilities. Together with Grace’s managerial skills and commercial background, Ali and Robert offered extensive technical knowledge to formed a multi skilled team. As the same time as the team was formed, talks were conducted to assess each merits of the projects available. BANQONIT project was one of the top priorities for our project, as it offered a structured project scope and was attracted to the project challenge. The official confirmation that we were part of the BANQONIT team and Lech as our project supervisor was announced on Wednesday 20 of March.

PROJECT INITIATION AND PLANNING

The first stage of the project started off with the official meeting with the BANQONIT sponsors on Wednesday 27^th March. We met the managing director of BANQONIT Keith Watson and technical advisor David Congerton, who both gave us a general idea on what the BANQONIT is about, it’s functionality and foreseen opportunities. The week after, Tuesday 2^nd April, the project team had another meeting with David, to discuss in technical details including the front end and the database of the BANQONIT system. The general scope of our project were finalised at the next meeting, Tuesday 9^th April with Keith. He explained in details the current environment surrounding BANQONIT. By highlighting its competitors, we focus on the proposed enhancement and other possible technical enhancements such as using mobiles to pay bills. By this stage, a project brief and schedule were due, which needed to be read by our sponsoring company before it can be presented.

ANALYSIS

The next stage of the system design life cycle is the “analysis” stage. This is the stage were we as a group review the existing 4D system. It is crucial that we understand the current system and its functionality in order to implement appropriate features and design in future. The next step is to determine the requirement of the proposed enhancement. Then we need to research on solutions to existing technology and platform. Towards the end of our analysis, we will present our analysis to our sponsors to discuss the final end decision on technical requirements.

LOGICAL DESIGN

The logical design incorporates business rules, taking into account data flows and structures. We will construct our logical design to compile with the system specification report, outlining our project by use case diagrams, Entity Relationship diagrams, Class and Sequence diagrams.

PHYSICAL DESIGN

This will be the stage where we build the physical design for our project. This will include the design over the application manager, the BANQONIT manager tool, the graphical design and the new database schema. Security and scalability will be issues we take into special account.

IMPLEMENTATION

Our next stage of the system design life cycle comes the implementation of our project, where the vase of the time has been estimated. Before we implement any of the new features, we must first convert the existing 4D system to SQL database according to our enhance solution objectives. After this has been completed, we can start our implementation of the new database schema, which later follows the implementation of 6 modes of connection, Web gateway, E-mail gateway, BANQONIT direct, BANQONIT Terminal mode, BANQONIT bulk upload and BANQONIT connect. After the mode of connection has been implemented, newly designed features will be implemented according. This includes the refund ability, pre authorisation and upon request detail reporting. We then connect the application to the BNZ buyline and then implement the graphic user interface. The last step of our implementation will be to connect the BANQONIT system tool to application manager functions.

DOCUMENTATION

Documentation will be written up through the whole system design life cycle to provide the most accurate information that is useful for its users and the BANQONIT company. Upon the completion of the project, as requested by the company, we must hand in system documentation and a user guide.

UNIVERSITY DEADLINES

13^th April 2002 Project Schedule Presentation

13^thApril 2002 Project Schedule Documentation Due

1^st June 2002 Project Specification Presentation

1^st June 2002 Project Specification Documentation Due

28^thSeptember 2002 Final Project Presentation

18^thOctober 2002 Final Project Documentation Due

18^thOctober 2002 System Hand Over to Sponsor

DELIVERABLES TO THE COMPANY

BANQONIT sponsors have set out a system design life cycle for the project group to follow loosely. The project activities are organized and structured in a way to fit the SDLC in order to accomplish the project. On top of the university requirements for BANQONIT project, the sponsors have especially requested the following deliverables from the project group.

System documentation- the general layout of the system including explicit information on each function, how it was implemented and possible unforeseen events.
Provide source code of the enhanced system on CD in accordance to the proposed enhancements.
User guides-. A step-by-step guide to enhance understanding of the system for users, developers and interested parties.
Standard programming procedure applies. – Be clear and easy to understand.

CONTINGENCIES

The world is forever changing; therefore we must take some pre-caution against unforeseen circumstances. The contingencies we have identified are listed below:

· Over scooping. During our visioning meeting, we have identified many opportunities in terms of business opportunities and system enhancement opportunities. There is the risk of over scooping for our project, therefore we have planned and set out our core priorities. However the other opportunities will always be an option and be implemented only when time is flexible.

· Team Cohesion. Through out the year, the team as a group will definitely face a clash of opinion and ideas. To prevent this, members has to keep in mind that the “project” is the focus and concentrate on resolving the differences by reasoning or compromising.

· Workload under estimation- If after our analysis of the system lead to under estimate of our project, we need to take immediate action to prevent further delays. Action such as extra careful planning and better management of time is needed if such event arises.

The known fact for contingencies is that “not all things will be known”. We must take extra caution to all part of BANQONIT system design life cycle.

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