Digital CAs: Not chartered accountants - Views on News from Equitymaster

Helping You Build Wealth With Honest Research
Since 1996. Try Now

  • MyStocks

MEMBER'S LOGINX

     
Login Failure
   
     
   
     
 
 
 
(Please do not use this option on a public machine)
 
     
 
 
 
  Sign Up | Forgot Password?  

Digital CAs: Not chartered accountants

Feb 5, 2001

With e-commerce transactions all set to boom, the next imperative is security. The issues that need to be addressed include authentication, integrity, confidentiality, non-repudiability and auditing. Authentication deals with establishing credibility of the transacting partner. Integrity and confidentiality deals with keeping data transferred between partners intact and private. Non-repudiability deals with establishing whether a party denying a transaction is true or not. Auditing keeps track of transaction that take place. Technology can to a great extent address integrity with the help of encryption but what about authentication? How can you be sure that the party you are dealing with is to be trusted? The answer is public key infrastructure (PKI). Using PKI, users can transact through the Internet securely. This is done using a public and a private cryptographic key pair that is obtained and shared through a trusted authority. This trusted authority is known as a certifying authority (CA). The CA issues a digital certificate that can identify an individual or an organization and directory services that can store and, when necessary, revoke the certificates.

Most CAs charge on a per-certificate or per-user basis. Since certificates are issued with a built-in expiration date (usually 6, 12 or 24 months), the model for recurring revenue is quite straightforward. This definitely means big business considering the volume of e-commerce in India. According to Gartner, currently the industry size is about US$ 1.1 bn globally.

Year B2B B2C Total
1998 - 99 1,190 120 1,310
1999 - 00 4,000 500 4,500
2000 - 01 32,000 3,000 35,000
2001 - 02 132,000 18,000 150,000
2002 - 03 420,000 80,000 500,000
Source : NASSCOM, Rs m

With the Indian Government recognizing digital certificates as a form of authentication to identity, the race is on to capture the market. The licenses for certifying authorities are being issued by Central Certifying Authority (CCA). CCA is empanelling auditors, who will audit the processes and technology of the CAs. Once the auditors are empanelled the CCA will issue guidelines for the CAs. Those who confirm to the standards proposed by the guidelines will be issued licenses. Considering the responsibility on the CA the licensing the government will be cautious while issuing licenses and this will take its own time.

The companies that are willing to acquire CA licenses include Satyam Infoway, HFCL, HDFC Bank, ICICI Bank and Citibank. (The banks having their payments gateways will definitely have an upper hand). Satyam Infoway has tied up with Verisign, one of the global leaders in the area.

This is one area that the companies can bank on to keep their cash registers ringing. Once the government empanels the race will begin. Till then companies, in the build up to the final race, will consolidate on technology and processes.

Equitymaster requests your view! Post a comment on "Digital CAs: Not chartered accountants". Click here!

  

More Views on News

FIRSTSOURCE SOLUTIONS Share Price Up by 5%; BSE IT Index Up 0.9% (Market Updates)

May 5, 2021 | Updated on May 5, 2021

FIRSTSOURCE SOLUTIONS share price is trading up by 5% and its current market price is Rs 131. The BSE IT is up by 0.9%. The top gainers in the BSE IT Index are FIRSTSOURCE SOLUTIONS (up 5.2%) and TAKE SOLUTIONS (up 9.2%). The top losers are SONATA SOFTWARE (down 0.1%) and MPHASIS (down 0.6%).

TAKE SOLUTIONS Share Price Up by 10%; BSE IT Index Up 0.9% (Market Updates)

May 5, 2021 | Updated on May 5, 2021

TAKE SOLUTIONS share price is trading up by 10% and its current market price is Rs 57. The BSE IT is up by 0.9%. The top gainers in the BSE IT Index is TAKE SOLUTIONS (up 10.3%). The top losers are TECH MAHINDRA (down 0.2%) and SONATA SOFTWARE (down 0.4%).

TAKE SOLUTIONS Share Price Up by 5%; BSE IT Index Up 0.9% (Market Updates)

May 5, 2021 | Updated on May 5, 2021

TAKE SOLUTIONS share price is trading up by 5% and its current market price is Rs 55. The BSE IT is up by 0.9%. The top gainers in the BSE IT Index is TAKE SOLUTIONS (up 5.1%). The top losers are TECH MAHINDRA (down 0.1%) and SONATA SOFTWARE (down 0.1%).

ECLERX SERVICES Share Price Up by 6%; BSE IT Index Up 0.5% (Market Updates)

May 5, 2021 | Updated on May 5, 2021

ECLERX SERVICES share price is trading up by 6% and its current market price is Rs 1,315. The BSE IT is up by 0.5%. The top gainers in the BSE IT Index is ECLERX SERVICES (up 5.9%). The top losers are TECH MAHINDRA (down 0.1%) and L&T INFOTECH (down 0.3%).

L&T Technology Shares Fall After Q4 Results. What Should Investors Do? (Views On News)

May 5, 2021

Despite strong deal wins and a low base in FY21, a big turn-off for investors was the muted FY22 revenue growth guidance.

More Views on News

Most Popular

Power Grid's InvIT IPO: Key Points to Consider (Company Info)

Apr 23, 2021

In this article, we discuss the key reasons why the stock of Power Grid was in focus today.

Time to Buy Smallcaps? (Fast Profits Daily)

Apr 30, 2021

In this video, I'll show you why I favour smallcaps over the Nifty.

The Next Smallcap Winners (Profit Hunter)

Apr 30, 2021

Price is the only due diligence one might require to buy this business.

This Fund Manager Has Taken the World by Storm. Will You Invest With Her? (Profit Hunter)

Apr 26, 2021

Should you invest with this Rockstar fund manager who has outperformed in a big way?

More

India's #1 Trader
Reveals His Secrets

Secret To Increasing Your Trading Profits Today
Get this Special Report,
The Secret to Increasing Your Trading Profits Today, Now!
We will never sell or rent your email id.
Please read our Terms

S&P BSE IT


May 5, 2021 (Close)

S&P BSE IT 5-YR ANALYSIS

COMPARE COMPANY

MARKET STATS