OTP an acronym for Open Trading Protocol is an over-arching XML - based initiative to allow electronic commerce technologies such as these to interoperate and peacefully coexist. OTP is aimed at smoothing the path towards the development of a pervasive retail trade infrastructure on the Internet.

OTP facilitates electronic commerce by providing digital equivalents of the familiar paper based trading methods.

OTP uses XML to describe the structure and content of the various types of messages that are required to achieve an electronic transaction, thereby providing an open standard to speak the same language in the electronic marketplace. The overall model of OTP of an invoice-payment-receipt is as shown.

XML used to describe structure & content of messages.

The OTP intends to benefit a wide range of users such as shoppers, financial institutions, merchants and software developers.

Customers benefit a lot as they now have a wide range of selection of merchants from whom they can make purchases. In addition, the transaction records can be used for tax or accounting purposes.

Financial institutions are benefited by offering OTP based financial services to merchants. Their customer base is extended to any merchant using OTP over the Internet. Through OTP, merchants offer purchasers a wide variety of payment options. The use of authentication and creation of records in OTP allow merchants to trade with confidence.

Software developers benefit because any OTP compliant applications that they develop will readily interoperate with applications developed by others. In a sense, every industry stands to benefit from the OTP standard. A standard way of trading over the Internet encourages competition and can thus lower the cost of trading for all concerned.

The OTP model offers two main ways of performing a trade. They are Cash trading and Debit/Credit trading.

Cash trading allows a consumer to deal directly with the merchant selling goods or service. This is as shown in the figure.

Debit/Credit trading involves a third party which maybe a financial institution to authorize purchases. The financial institution then settles with the merchant and takes on the payment seeking itself. The figure shows the process of Debit/Credit trading with OTP.

Five entities can participate in OTP trading. They are Consumers, Customer Care Provider, Value Acquirer, Merchant and Deliverer.

The customer is the entity that is willing to pay and receive goods or services. The Customer Care Provider is the entity that is responsible for dealing with disputes.

The organisation that settles the transactions done through Debit/Credit trading with the merchant and receives payment from the consumer. Merchant is the entity selling goods or services. Deliverer is the entity that is responsible for delivering the goods traded from the merchant to the consumer.

The image shown describes the relationship between the five entities.

An OTP message consists of a collection of trading blocks, which in turn consists of individual OTP transaction components. This is as shown in the figure.

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