Despite success of Alibaba, Chinese online shoppers among most paranoid when it comes to e-commerce security - and for good reason
PUBLISHED : Thursday, 03 September, 2015, 7:30am
UPDATED : Friday, 04 September, 2015, 12:40pm
James Griffiths
[email protected] @jgriffiths
Many Chinese save money these days by shopping online or on their mobile, but as reports of hacking attacks multiply, they have also become among the most fearful. Photo: Handout
Online shoppers in China are more concerned about safety than their peers in most other countries, despite their booming native e-commerce market that now boasts over 430 million customers, a report said this week.
About one in four online shoppers worldwide prioritise security when choosing an online vendor, according to digital payments firm WorldPay.
"Transparency around security is particularly important in China, where 70 per cent of shoppers said they feel more secure shopping when payment authentication and certificate logos are clearly displayed," the report said.
Chinese consumers were also among the most suspicious of vendors and payment providers. Some 65 per cent said they expected reassurance that their details will be kept safe by the retailer, and a clear explanation of how this will be done.
According to the official Ministry of Industry and Information Technology, around 55 per cent of Chinese internet users have been victims of online fraud, with young people and elderly users being frequent targets.
Smartphones can feel especially vulnerable, especially after the news released this week of one of the largest-ever attacks on iPhones by Chinese hackers. Photo: Simon Song
In May, online banking customers in northern China alleged that more than 20 million yuan (US$3.1 million) had been taken from their accounts after they were targeted by scammers.
A survey conducted by the Internet Society of China, an NGO, found that Chinese online users lost over 80 billion yuan (US$13 billion) to fraudsters in 2014. About 75 per cent of respondents said they had also lost personal data.
This level of mistrust can lead to problems for retailers, WorldPay said.
"Purchasing products online demands a certain level of trust between retailers and shoppers," said Stuart Thornton, the company's vice president of business development in Asia Pacific.
"Retailers will struggle to inspire confidence in their customers if they cannot deliver on shoppers' expectations and give them peace of mind throughout the online shopping journey."
China's central bank recently announced draft legislation that would stringently regulate online payments, limiting services that do not require users to present multiple forms of identity verification.
While the move would improve security, it has been criticised by experts who warn that it could limit innovation and hamper the expansion of existing platforms.
Research firm Equinix expects Asia's retail e-commerce market to grow to over US$1.58 trillion by 2016.
