Online security fears are hindering e-commerce

Online security fears are hindering e-commerce

Consumers’ lack of confidence in the strength of online security is hindering the expansion of Internet shopping according to research commissioned by the UK's National Consumer Council. The survey was conducted before a recent spate of security breaches and breakdowns at prominent bank and merchant Web sites.

A summary of the findings reveals that key consumer concerns centre on releasing credit card and personal details online, lack of opportunity to check goods before paying and the risk of fraudulent suppliers. These fears are compounded by widespread ignorance about legal rights and redress for consumers when things go wrong.

National Consumer Council director, Anna Bradley, says: "It is especially worrying that Internet users are more – not less – likely to harbour doubts about shopping online."

For instance, almost four out of ten adults see the need to release credit card details as a major disadvantage of Internet shopping. Among Internet users, more than half feel the same way.

"Unless the total online shopping environment – sites and payment mechanisms – is made more secure, some consumers will never have the confidence to explore the opportunities," says Bradley.

Alarmed by rising levels of chargebacks on Internet-based card transactions, Visa recently released details of a new model for credit card security based on the Secure Electronic Transaction (SET) standard. Visa issuing banks in the EU must adopt the new model by October 2001. As an added incentive, those which register for the programme by October of this year wil be free to acquire Internet merchants in other European countries.

Key findings of the NCC research, include:

* 26% of UK adults have access to the Internet–either at home or at work;

* only three per cent of UK adults say they regularly shop online;

* 85% of UK adults consider the high street to be the safest place to shop - 35% think that the Internet is the riskiest;

* among Internet users, 55% think online shopping is the most risky;

* among Internet users, 54% express concern at releasing credit card details online;

* among Internet users, 51% say being unable to physically inspect the goods before paying is a main disadvantage;

* among Internet users, 30% believed that there was a risk from fraudulent suppliers.

The research was conducted by Mori between March and May 2000, predating the recent security breakdowns at PowerGen and Barclays Bank, when some customers gained access to the account details and credit card numbers of other people.

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