News • 27.08.2018

Is fraud inevitable when shopping online?

Two thirds of UK consumers think so but chose convenience anyway

The majority of UK consumers now accept the risk of fraud when shopping online as eCommerce shows no signs of slowing down, according to findings from Paysafe. Seven in 10 (70 percent) now prefer shopping online rather than going to physical stores, and a similar number (68 percent) shop online much more than they did a year ago.

Banknotes secured by a lock and a credit card with keys; copyright:...
Source: panthermedia.net / dedivan1923

This is despite almost two thirds (65 percent) of consumers accepting that a certain level of ecommerce fraud is ‘inevitable’ during the ecommerce process, up from 52 percent last year, underlining the increasing value consumers put on convenience.

One third (33 percent) of UK shoppers said they have experienced payment fraud in the past year, up 6 percent on 2017. This is perhaps symptomatic of merchants continuing to prioritise digital sales. Research from Ovum shows 58 percent of merchants place great value in reducing lost sales online compared to tackling fraud. Nearly half (48 percent) admitted they would accept a higher level of fraud in return for greater sales.

Preferred payment methods for customers

The report from global payments provider Paysafe also showed that when shopping online, 61 percent have used digital wallets in the past month, 34 percent have used a credit card, and 57 percent a debit card. Meanwhile, 51 percent are using in-app purchases more than a year ago, as the popularity of services such as Uber and Deliveroo change the traditional eCommerce payment process by retaining customers’ information for a seamless app experience. In fact, 79 percent now say they prefer to shop on a website that already has their payment information stored, highlighting that UK consumers place a premium on convenience.

Yet, data shows these attitudes do not translate to the realm of ‘frictionless’ payments – i.e. invisible transactions that take place ‘behind the scenes’ in apps – which are being held back by UK consumer concerns over security and data privacy, according to the findings. 52 percent of UK consumers cite fraud as the biggest barrier to using them; 43 percent express concerns around the use of their data, while two thirds (67 percent) think voice-activated systems are not secure.

What about cash payments?

And in spite of the popularity of eCommerce, cash continues to thrive as the most common form of payment: 88 percent of consumers used it in the past month to make a purchase. Although 62 percent of UK consumers carry less cash than they did a year ago, falling from an average of 33 pound last year to 21 pound in 2018, their relationship with cash is changing and there are other ways to keep it at the forefront of the payment mix.

For example, in Austria and Germany, online cash replacement systems which negate the need to share financial data are used by 12 percent and 9 percent of respondents respectively. Indeed, 67 percent of UK consumers said they feel more comfortable purchasing online via a payment option where their financial details are not shared. In North America, prepaid cards are the most popular cash alternative, used by 18 percent of Canadians and 16 percent of Americans respectively.

Biometric payment methods

Commenting on the research, Oscar Nieboer, Chief Marketing Officer, Paysafe Group, said: “UK consumers’ attitudes towards fraud in payments are largely defined by the medium of the transaction. In the UK, we have now reached a level of maturity in online retail – most websites are optimised, the checkout process is increasingly simple and delivery is getting quicker. In turn, more consumers are telling us they are accepting a level of fraud for this convenience. What is notable, though, is the same rules do not yet apply to biometrics, such as voice-activated payments. The idea of a consumer’s unique biometric data being defrauded is uncomfortable, and this manifests as emerging technology like voice not yet attracting mainstream usage for payments.”

These findings emerge as other regions are taking active steps to navigate the fraud landscape typically associated with online retail. Only 28 percent and 26 percent of German and Austrian consumers accept a level of fraud is inevitable, which is why pay by invoice is popular in these regions. 29 percent of Germans and 38 percent of Austrians have used this method, which circumnavigates the entry of payment details online, with offline verification and authentication replacing it.

“What the diversity of payment types in other regions shows is we shouldn’t simply accept fraud. We shouldn’t have to choose between risk and convenience, and in a time of hyper-awareness around data security and privacy, merchants must place a premium on securing customers’ data now more than ever,” said Nieboer.

Source: Paysafe

related articles:

popular articles:

Thumbnail-Photo: The iXtenso editors tested self-scanning ......
30.09.2019   #mobile payment #self-checkout systems

The iXtenso editors tested self-scanning ...

... with an app of the Hobbymarkt Knauber in Bonn, Germany

Snabble has developed a payment app that allows customers to scan their purchases in retail stores and pay online. I wondered: How does it work?The app is in use in the Bonn DIY and hobby market Knauber, among other places. Let’s make a move ...

Thumbnail-Photo: retail trends 3-2019: focus checkout zone
16.09.2019   #mobile payment #customer satisfaction

retail trends 3-2019: focus "checkout zone"

Shopfitting, technology, marketing: What does a checkout have to do nowadays?

Read our latest edition retail trends 3-2019 online as an e-paper. ...

Thumbnail-Photo: When the product becomes the POS
19.08.2019   #mobile payment #pos systems

When the product becomes the POS

“Mobile-first” or the future of the Point of Sale

The classic Point of Sale means physical sales areas including a terminal, cash systems and queues. But this traditional image is changing. Nowadays many customers in brick-and-mortar retail outlets expect the same experience as online and require ...

Thumbnail-Photo: Retail Asia Conference & Expo (RACE)
07.10.2019   #online trading #retail

Retail Asia Conference & Expo (RACE)

As the leading retail exhibition in Asia, RACE is taken place from 6 – 8 May 2020.

As the leading retail exhibition in Asia, RACE is recognised as the must-join event among the industry’s most influential retailers and customers. RACE features three focus areas: Retail technology, retail design & in-store marketing ...

Thumbnail-Photo: New year brings new regulations
13.09.2019   #data management #receipt printer

New year brings new regulations

What are the big changes for German point of sales systems come 2020?

Big changes are coming to Germany’s point of sale systems starting January 1, 2020. Two terms that are tossed around in this connection are "Belegausgabepflicht" (Receipt Provision Ordinance) and ...

Thumbnail-Photo: 45th anniversary of the barcode in retail
01.07.2019   #barcode scanner #qr code

45th anniversary of the barcode in retail

GS1 US celebrates the barcode’s relevance as the backbone of commerce

GS1 US®, the information standards organization best known as the administrator of UPC barcodes, this week celebrates 45 years since the debut and first scan of the iconic barcode. On June 26, 1974, a pack of Wrigley's chewing gum carrying a ...

Thumbnail-Photo: Tackling organized retail crime with video analytics...
26.06.2019   #video surveillance #digital video surveillance

Tackling organized retail crime with video analytics

Inpixon joins forces with National Anti-Organized Retail Crime Association

Inpixon, an indoor positioning and data analytics company, announced it is collaborating with the National Anti-Organized Retail Crime Association (NAORCA Worldwide) to combat retail crime by providing a free 90-day trial offer for IPA Video™ ...

Thumbnail-Photo: Denmarks largest garden center chain is chasing a green profile...
26.06.2019   #sustainability #electronic shelf labels (ESL)

Denmark's largest garden center chain is chasing a green profile

Electronic shelf labels for paper reduction

Plantorama introduces electronic shelf labels in all stores, which significantly reduces the chain's paper consumption. The project will strengthen the chain's green profile and will have a positive influence on the customer experience and ...

Thumbnail-Photo: Well cooled shopping entertainment, please!
15.07.2019   #refrigeration cabinets #refrigerated counters

Well cooled shopping entertainment, please!

What about modern refrigeration technology?

Pierluigi Schiesaro and Gian Paolo Di Marco from Arneg, a company focusing on food service equipments, talk about refrigeration systems as "shopping entertainment".They also tell us what sustainable refrigeration could look like and why ...

Thumbnail-Photo: Improving performance with video training
19.06.2019   #personnel management #video

Improving performance with video training

Video tutorials for inventory management or customer service excellence

Smart Retail Solutions (SRS) has announced their ProfitTrax Platform is now including Best Practice Video Training in its Advanced Analytics Suite. Their team has successfully implemented the update because they believe the key to profit improvement ...

Supplier

APG Cash Drawer
APG Cash Drawer
4 The Drove
BN9 0LA Newhaven
Permaplay Media Solutions GmbH
Permaplay Media Solutions GmbH
Aschmattstr. 8
76532 Baden-Baden
Delfi Technologies GmbH
Delfi Technologies GmbH
Landgraben 75
24232 Schönkirchen
iXtenso - Magazin für den Einzelhandel
iXtenso - Magazin für den Einzelhandel
Celsiusstraße 43
53125 Bonn
Superdata GmbH
Superdata GmbH
Ruhrstr. 90
22761 Hamburg