3 in 10 consumers don't trust retailers with their data
Posted on 22 July 2014.
A global fraud study by ACI Worldwide and Aite Group of more than 6,100 consumers across 20 countries revealed distrust among global consumers in retailers to protect their data. Among other findings, only slightly more than 50 percent of consumers feel stores where they shop use security systems that adequately protect their financial data against hackers and data breaches.

Retailer concerns:
  • Nearly 3 in 10 global consumers (29 percent) do not trust retailers (e.g., stores, online shopping sites, restaurants, etc.) to protect stored personal and financial data against hacking attempts and data breaches.
  • 58 percent think financial institutions (large multinational institutions, community banks and credit unions) do a better job of protecting their data than do retailers, or for that matter, government agencies and law enforcement.
  • Only 55 percent feel stores where they shop use security systems that adequately protect their financial data against hackers and data breaches, compared to 62 percent who believe that online shopping websites adequately protect this information.
“Consumers want to engage in the battle against fraud. Financial institutions must take a proactive role in not only engaging customers in fraud-alerting activities, but educating them on preventative measures to take to most effectively combat it,” Shirley Inscoe, senior analyst, Aite Group.

Mobile customer engagement:
  • More than 3 in 4 global consumers (77 percent) are “very interested” in being contacted about suspicious activity on their cards or accounts via a phone call, email or text message.
  • Approximately 3 in 4 (73 percent) prefer that their banks not post transactions to their cards until they respond to fraud alerts.
“Retailers have their work cut out for them—to change consumer perception that shopping, be it online or in-store, is unsafe,” Mike Braatz, senior vice president, Payments Risk Management Solutions, ACI Worldwide.

Consumer awareness:
  • More than 4 in 10 global consumers (42 percent) do not recall receiving any anti-fraud information from their financial institution.
  • More than 3 in 10 (32 percent) think theft by a computer hacker is the greatest fraud risk.
“Consumers want to engage in the battle against fraud. Financial institutions must take a proactive role in not only engaging customers in fraud-alerting activities, but educating them on preventative measures to take to most effectively combat it,” Shirley Inscoe, senior analyst, Aite Group.

Prepaid card implications:
  • In many countries, prepaid card usage and the rate of fraud on such cards correlates. China and India have the highest rates of prepaid card fraud at 17 percent and 18 percent, respectively, and very high consumer use rates at 93 percent and 91 percent, respectively.
  • Conversely, in countries with use rates of 70 percent or less, such as Australia, Canada, New Zealand and the United States, fraud rates are 4 percent or less, indicating that the fraud rate may rise as more consumers use prepaid cards.





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