Cape Town - Results from two recent surveys by
MasterCard suggest that South African online retailers could possibly boost
their sales by more than R115m if they were to provide South African shoppers
with a more secure means to pay for their online purchases, MasterCard said on
Thursday.
One survey revealed that 48% of South Africans feel vulnerable when using
credit or debit cards to purchase goods and services via the internet. Only 20%
said that they felt safe shopping online with their cards.
When asked if they felt that the lack of personalised verification made
potential fraudulent card transactions too easy, a massive 73% agreed.
In order to combat online shoppers' fears about the security of their payment
card details, MasterCard launched MasterCard® SecureCode™ in South Africa in
2004.
When shoppers enter their card information on a merchant's website bearing
the SecureCode logo, they are prompted to enter their personal SecureCode by a
special window or screen presented by their card issuer.
MasterCard SecureCode enables cardholders to choose a code known only to them
- similar to a PIN number for a bank ATM transaction.
In a matter of seconds, the card issuer confirms that it is indeed the
cardholder making the purchase and authorises the transaction.
Another MasterCard survey, carried out in the UK, found that 35% of people
who currently shop online said that they would shop online more if their banks
and retailers offered this enhanced level of online security.
The average amount that consumers said they would increase their average
spend by, was over a third (34%).
Response from banks
Based on 2003 figures, this could equate to R115m in additional purchases by
South African's online shoppers, since research carried out by local research
house, World Wide Worx, indicated that a total of R341m in online retail sales
was achieved during 2003 in South Africa.
"Our experience has shown that the results of the UK research,
comparatively speaking, would closely reflect South African online shopping
statistics and consumer sentiment towards purchasing goods online," said
MasterCard's Eddie Grobler.
"As a result, we expect the online shopping industry in South Africa to
experience significant growth in the near future, if there is an increase in
security solutions and measures that help alleviate consumers' online shopping
fears."
He added that the response from all the major South African banks to
SecureCode had been extremely positive, and a significant number of online
retailers were currently offering MasterCard SecureCode in South Africa.
MasterCard was confident that additional local retailers will sign up to the
service, thereby helping to tackle the level of internet fraud. In turn, this
will encourage a new wave of South African consumers to shop online.
More than 22 000 merchants and approximately 2 700 issuing
financial institutions worldwide are now participating in the programme.
