The intermediary acts as an electronic bank that converts legal
tender
currency into a private currency system (using tokens or digital
currency)
which is circulated within electronic commerce markets.
A DCP system does not transmit sensitive or payment information
between
buyers and sellers, but instead transmit a digital token that
represents
monetary values, that is, a digital currency. The nature of
digital currency
mirrors that of paper money as a means of payment. This is
similar to sending
a $10 bill in the mail. As such, digital currency EPS's have the
same
advantages as paper currency payments, namely anonymity and
acceptance
of micro-payments.
Depending on implementation, a possible feature of DCP's is the
capability
to make peer-to-peer transactions, where two individuals can
exchange
money without involving a third party.
Examples of DCPs are Visa Cash (http://www.visa.com), and
MasterCard
Mondex (http://www.mondex.com). Singapore's implementation