ABSTRACT
This chapter provides an overview of micropayments for both face-to-face purchases and online transactions. The main approaches used are service prepayment, offline authorization, and grouping of micropayments before financial clearance. For online micropayments, the transactions may be settled periodically by the means of payment instruments determined at subscription. Online micropayment solutions target the sale of virtual content: newspaper archives, online games, horoscopes, games, pictures, music, videos, and so forth. PayPal, which is also an account-based system, has online micropayment solution as well. However, this is a small part of the overall business. The computing capabilities of iPhones and Android smartphones as well as the growth in mobile games have accelerated the demand for online processing of micropayments. Micropayment solutions are not perceived to be suitable for money laundering or the financing of illegal activities, so there is little monitoring by banking and legal authorities.
