Fraud fears hitting online shopping

Fraud fears hitting online shopping

The fear of identity theft is forcing many consumers to cut the amount they spend on online purchases, according to research commissioned by RSA Security.

The survey, conducted by Momentum Research Group, found that Brits spend more online than shoppers in Germany, France and US. UK consumers spent an average of EUR231 during September 2005, compared to the poll's average of EUR153. US shoppers spent an average of EUR129 per capita.

But while the number of Web transactions is increasing, the fear of online crime is leading to consumers cutting the amount they spend on purchases. The survey found that 13% of UK consumers and 16% of US shoppers are spending less than they used to online, compared to six per cent in Germany and nine per cent in France.

RSA says the research shows that nine out of ten US consumers are aware of the danger of identity theft, but knowledge of ID theft is much lower in France and Germany, where one in three consumers are still unfamiliar with the concept.

"With this year's ongoing wave of publicity around US-based data breaches and online fraud, it shouldn't be a surprise to anyone that understanding of these threats is highest in North America," says Art Coviello, president and CEO of RSA Security. "What concerns me is that, while the industry is working hard to promote best practices and defence measures to our citizens, a high volume remain blissfully unaware of what identity theft is - leaving them exposed to potential exploitation."

The survey also found that lack of confidence in online retailers is also holding consumers back from making larger purchases. The confidence issue is most pronounced in the US with almost half of consumers stating that they have little or no confidence that businesses were taking all the steps necessary to protect their personal data.

RSA says consumers also feel that e-tailers and banks are the entities responsible when it comes to protecting personal data and reimbursing customers when things go wrong.

Says Coviello: "For consumers, the key to online confidence lies at the door of the business community - meaning that it is imperative for online vendors to be seen taking appropriate measures to protect their customers' interests."

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