Trends & Guides

An Insight Into Online Payment Insecurities

12 January 2016 | Leanna Seah

The Internet has become an extension of our lives - from interacting with our peers on social media, obtaining an education to even seeking out romantic partners, we are for the most part, comfortable with performing our societal rituals on an online medium.

There is however, one aspect of life that doesn’t translate as well – and that is giving up our hard earned money to someone on the other side of the world through a screen. So why exactly are some of us still apprehensive about the big bad world of online transactions?

In 2014, Kaspersky and B2B pU ran a survey on consumer security risks and the numbers revealed that 49% of participants worldwide still encountered feelings of vulnerability regarding online transactions with 37% having admitted to terminating a financial operation midway due to lack of faith in the security of the transaction. However, 42% expressed that they were more likely to utilize online payment solutions if they felt they were protected from cybersecurity threats. Overall, the largest cause of fear is financial fraud, with 62% of participants listing it down as their major concern.

So, why is it that we’re so willing to share our umpteenth selfie with a global audience but are still apprehensive about utilizing our PayPal accounts? What all of this points to is the fact that when it comes to handing over money to an unseen third party force, security is still a major concern.

Bartering safety in exchange for convenience does not seem like a fair trade and this notion is further perpetuated by the growing list of online security hacks that come with the capacity to rattle the foundation of e-commerce and its rewards.

Jump to:

Online Payments and the Decision Making Model

One of the most gratifying feelings in the world has to come from hitting the “add to cart” button and watching your online shopping cart fill up as your more hardworking colleagues shoot you the stink-eye for indulging in retail therapy during office hours.

Along with that however, many of us are also all too familiar with the scenario where we hover our mouse over the “checkout now” button before tentatively backing away as a laundry list of questions play through our heads –are my personal details correct? am I spending too much? what if they send my parcel to the wrong address? how will I get it back? Am I compromising my safety by sharing my payment details online?

All these questions play a part in our internal decision making process as consumers and act as determinants as to whether or not we wind up committing ourselves to the end goal- making the payment.

Our thought process goes through a 4-stage roadmap according to the decision making model and the cr takeaway is that our information search wields the ability to influence our final decisions.

So when we ask ourselves if our anxieties about online transactions are legitimate, the answer is a blunt yes. We are fm to fear for our security but what we can do as reactive consumers is to utilize our pre-conceived concerns to motivate our quest for education instead of operating on lofty misconceptions regarding online payment and cyber security.

Lest we intend on living out the rest of our lives living in fear of the checkout button.

Are Offline Payments More Secure Than Online?

Back in 2013, UK’s The Telegraph ran an article highlighting the reluctance of paying with smart technology and a quote from one of its respondents does well to personify the mental state we fall back on in the face of new payment technology.

“I’m wary of contactless payments because you can’t see it and you don’t know what could go through ... I just don’t trust it if I can’t see it. “

It’s true that online payments happen on a level that even on better days, would go way past the heads of those of us who aren’t equipped with technical know-how, but let’s just hit the refresh button for a second and look at things from a perspective that isn’t dogged by pre-dated convention.

Offline retailers typically work with older formats of data protection, making them more susceptible to hacks and security breaches. An article that ran in the Huffington Post called out US retail giants Target and Home Depot for their retail breaches In 2014 being due to lax commitment to online security.

On the other end of the spectrum, technological shifts in digital payment solutions and advancements in cybersecurity are equipped with security tools that have been strategically built to function in the increasingly digitized world that we live in today.

For example, Paypal Security Key gives users a second authentication factor when logging into their accounts while reputable banks offers unique Transaction Authorization Codes (TAC) to ensure an added level of security whilst performing online transactions.

At iprice, we take security one step further by ensuring that our visitors are only connected with reputable vendors in the seven countries that we operate in. There are several criteria that a merchant has to pass before we consider adding them to our network – among them is their reputation of being a reliable seller, their customer service track record, and most importantly, that they only operate via secure shopping and payment platforms.

Technology has also paved the way for shoppers to have more control over their online transactions. From creating strong passwords to signing up for identify theft protection services such as LifeLock and IdentityForce, consumers are being empowered to protect themselves and their personal details in tandem with the security measures that are being locked in by online retailers.

Popular Methods of Online Payment in Asia

On an optimistic note, the Asia-Pacific region is one of the fastest growing e-commerce markets and while security is still a leading factor as to why some of us still get queasy when it comes to online payment, we are for the most part, pretty tuned it towards online solutions. 30% of our transactions, are made using the e-wallet method and this trend is reportedly set to grow in the future. Not too shabby we reckon.

Take a look below to see three examples of popular online payment trends in Asia along with the security measures that go along with them.

  • Online bank transfer

The most common online payment method, online bank transfers involve transferring funds from one party to another. Touted as the most reliable format of online payment, consolidated payment gateways are usually supported by encryption technology that protects personal information from hackers and security breaches.

Users have the option of linking their mobile phones and email accounts to their online bank accounts to keep track of their transaction histories and receive alerts on whatever banking activity is performed through their account.

Quick and easy, online banks transfers are probably the best way to ease people into digitized payments as the user is constantly looped into the payment process. You get to physically see where your money goes and when it arrives in a matter of seconds.

  • E-wallet

The fastest growing payment method in the world with PayPal being the most recognized service provider. Users can store multiple credit cards and bank account numbers on one secure platform and have the option of transferring funds, making payments and etc. without having to key in their account information.

In terms of safety, PayPal provides users with a second authentication factor and data encryption. User information is protected by an SSL that makes sure it’s encrypted and cannot be pilfered while in transit across the internet.

Known for its focus on buyer protection, PayPal sends out email confirmations every time a transaction is made and also offers the option to refund shipping costs on eligible items if customers are unhappy with their order.

  • Mobile payment

The sexier, younger sibling of online payment, mobile payment is essentially using a mobile phone to pay for goods and services. With a growing number of firms gearing investments towards mobile marketplaces such as Carousell in Singapore, there is a huge opportunity for mobile based payments to take off in Asia.

Safety wise, experts recommend using systems that require a two-factor authentication which involves typing in a password and then following up with additional information.

What Else Can I Do to Protect Myself?

The harsh reality is that whether you opt for offline or online methods of payment, security is and always will be a concern. What we can do as consumers, is to take the right steps to protect ourselves as well as look out for identifiers that legitimize our shopping and payment platforms.

Here are some of the steps we can take:

As a Vendor, What Can I Do to Assure Customers of Their Security?

To compel consumers to actively use online payment methods, vendors must first be able to reassure shoppers that their security is a constant priority. The image below illustrates some of the measures vendors can take to build trust within shoppers.

Build a Fort Around Your Credit Card

To further up your guard, financial comparison website suggests putting up additional defences around your credit card to ensure your safety. The visual below illustrates a number of methods users can employ to protect their credit card from fraudsters and the like.

Here in South East Asia, the e-commerce backdrop is one that continues to grow from strength to strength. It is a thriving market that makes up 45.7% of internet users worldwide, 67% of which are under 35 years of age – the driving demographic behind e-commerce and statistically, the most internet savvy generation of today.

While security concerns will continue to remain as one of the leading reasons people are hesitant to migrate their payments to an online platform, the combined trends of an increasingly perceptive internet user base and c7 distinct, clear-cut security measures will hopefully tip the scale towards the direction of online payments.

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