Existing payment services and the legislative framework for
e-commerce are serious drawbacks to online retailers, the
Interactive Media in Retail Group (IMRG), said last week.
The group, the main industry body for online retailers, called on
the Government and the payments industry to address the situation
and to do considerably more to dispel myths and reassure consumers
that Internet shopping is safe.
"Payment mechanisms are not fair to merchants," said James Roper,
chief executive of the IMRG. "Charge-backs, when the consumer can
get a refund within six months of making the purchase without a
reason, are still the main problem."
While it would appear that the balance may be shifting, with both
Visa and Mastercard launching payment schemes that move the burden
from the retailer to the payment card issuer in the case of fraud,
Roper said more can be done.
"The Visa and Mastercard services are there but, as far as we are
aware, no one has taken them up," he said. "You have to question
how much the services will actually help the retailer."
Micro-payment services, where consumers are able to purchase goods
and services online and make one payment at the end of the month,
for example, via their mobile phone bill, will help online
retailers, but critical mass is vital, Roper said.
"Moving billing online is such an obvious move but it remains to be
seen how widespread it will be," he said. "If these systems were so
good the payment providers would have moved in long ago."
The Government and the payments industry have paid lip-service to
the real needs of online retailers to date, according to Roper. For
example, he said, consumers are not given enough clear information
about purchasing goods and services over the Internet.
"Why can't government and the banks make it absolutely clear that
e-retailing is safe?" he asked. "They make the right noises but
they are not doing enough to get the message across."
Roper was also critical of the European Union's move to regulate
online retail with the e-commerce directive, which will be
implemented in the coming months.
"Governments should support self regulation until
e-commerce has fully matured," he said. "Otherwise they are basing
decisions on guesswork - which they usually get wrong."
However, as the legislation will be passed in some form, Roper said
the IMRG has lobbied the EU to make sure penalties for breaking the
law are light.