Security Concerns Cost Merchants $110B

Due to a severe lack of confidence in using credit cards online, companies will in all likely lose almost $110 billion every year in lost sales.

These figures have been provided by a customer survey by Javelin Strategy & Research and Payment One.

As many as four from five people who were surveyed explained that they would probably use their credit cards more often if they knew that websites had more and better security and had an alternative to typing in credit card details into the websites payment form.

As many as fifty percent of people surveyed explained that they were concerned that their credit card details would be intercepted at some stage when ordering an item from a website that was not secure enough.

Also they were concerned that thieves would be able to hijack their credit card details after hacking a less than secure website. Another concern was that the company itself may abuse the credit card information themselves.

Some of those customer worries are not entirely groundless as in a recent survey carried out by the Gartner Group, IT professionals revealed that at least 20 percent of companies did not meet the Payment Card Industry Data Security Standard.

According to Gartner’s report, the main reason for this lack of security was budget cuts at large companies which were forcing IT managers to be more risky with their customer’s private financial and personal data.

MasterCard and Intel have recently said that a partnership would be beneficial to consumers as they would be able to use “tap and go” credit cards to help pay for their online purchases. Also, eBay has announced that it will be offering a virtual wallet system through its subsidiary financial company, PayPal.

As many as 60 percent of people surveyed by Javelin have stated that they would be open to replacing the current credit card system with one that would charge their purchases directly to their wireless phone.

But according to the Federal Communications Commission have warned that out of date regulations could make shoppers even more open to fraud if they use they charge purchases to their cell phone instead of their credit card.

Officials from the FCC say that as many as 20 million consumers pay for errant transactions on their accounts, with only 5 percent of the victims noticing the fraudulent transactions.

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