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Lack of trust in online shopping still holding back ecommerce

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One in three UK internet users are not yet shopping online, new research from the Office of Fair Trading (OFT) has found.

Of these internet users, 30% identified lack of trust as the main factor holding them back, whilst 20% cited fears over personal security and 15% said they did not trust companies that sell online.

While consumer confidence is gradually improving, says the OFT, overall levels are still too low for the market to reach its full potential. Even for those who do shop using the internet, which were roughly half the people interviewed, 72% say they still have concerns over doing so and 38% are, at best, only slightly aware of their online consumer rights.

Since publishing a market study into internet shopping in 2007, the OFT has focused on increasing consumers’ awareness online and on business compliance. This included:

  • Securing agreement from the top five auction sites to provide information to consumers about their rights under the Distance Selling Regulations — including cancellation rights.

  • The OFT’s consumer advice line Consumer Direct publishing top tips for safe shopping online, such as how to understand refund policies.

  • Updating ‘advice to business’ webpages, including advice for small firms on online security.

The 2009 figures, the OFT reports, indicate that despite concerns there have been some positive changes. Among the people who do shop online 54% feel it is as safe as shopping in store, compared to 26% in 2006.

New figures also released today by Consumer Direct show that more people than ever are seeking guidance about internet shopping transactions. Enquiries about online purchases now account for 10% of calls to Consumer Direct, compared to 6% in 2006.

“Online retailing is the future for many businesses and increasingly important to the economy,” says John Fingleton, chief executive of the OFT. “If consumers are not confident online, demand will grow at a slower rate. So, we must tackle these concerns right now if the online market is to grow at its full potential.”

The government is also planning to look into the issue of consumer trust in online shopping. “It’s encouraging that the OFT’s survey shows increasing consumer confidence when buying online — but people still have concerns,” says Gareth Thomas, minister for consumer affairs. “That’s why we will be setting out proposals in our forthcoming consumer white paper to better protect people from fraudsters and increase their consumer knowledge when shopping online.”

Readers can download the full report from the OFT website.

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