Anatomy of Credit Card Cashing Based on Third-Party Payment

With the rapid development of credit card business in recent years, there emerges credit card fraud. The growing popularity of e-commerce with third-party payment gradually as leading electronic payment means make credit card cashing based on third-party payment become a main form of credit card fraud. The paper makes an overall description of the credit card cashing. Based on the financing channel selection model in which trader chooses among different cashing channel to minimize financing costs, it expounds that oversupply of credit card and high interest rate from normal financing channel push consumers cashing with credit card, while the properties of e-commerce, such as low transaction costs, asymmetric information and hard to monitor, facilitate the credit card cashing. Therefore, third-party payment will become the main channel of credit card cashing. Finally, the paper proposes to control the issuance of credit cards, limit the amount of each C-C transaction paid by credit card, and raise the cost of transaction to restrict credit card cashing through third-party payment.