A Digital Certificate is a special document provided by a reliable authority (referred to as a Certificate Authority, or CA), that establishes the credentials of a business or institution on the Internet. Guided by the SSL protocol, the Digital Certificate connects the owner's identity with a public key, which is accessible by anyone. In a secure session in a web browser over the Internet, this can be used to validate the merchant or business entity, since this certificate can be validated only by its corresponding private key, present only with the certificate owner.
Digital certificates can be used for a variety of transactions, although their usage has been most prominent in E-commerce. Essentially, it certifies that a business is indeed connected with a particular website, thus providing an online identification method.
To a consumer, it provides the assurance that the online transaction he is indulging in, is actually being promoted by a genuine business or institution. The certificate thus establishes a secure path between the merchant and the consumer.