Consumers Still Leery of Shopping Online
Jean-François Codère - Journal de Montréal - March 3, 2003
"Consumers might be more willing to shop online if they could complete the transactions through their banks, who they appear more willing to trust," commented Éric Lacroix, research director at the Centre Francophone d'Informatisation des Entreprises (CEFRIO), upon the release of the NETendances findings in January 2003.
Security concerns continue to impede the progress of electronic commerce. But a small Montreal firm named Othentik is facing that fear head-on.
When it comes to shopping online, consumers and merchants alike are still too afraid of fraud. Only 8.4% of Quebec adults surveyed in October 2002 for a NETendances study had made an online purchase in the previous month. Despite this fact, 24.2% had engaged in online banking, a consistent growth sector.
"Consumers might be more willing to shop online if they could complete the transactions through their banks, who they appear more willing to trust," commented Éric Lacroix, research director at the Centre Francophone d'Informatisation des Entreprises (CEFRIO), upon the release of the NETendances findings in January 2003.
The solution
This is precisely the solution advanced by Othentik. What's more, online shoppers can use their debit cards instead of their credit cards to settle online purchases.
The Othentik solution calls for banks and online merchants to work in tandem. When Internet users click "buy," a small window pops up and directs them to their bank's website. They log on by keying in a username and password-much like a PIN-and, from there, it's a simple matter of choosing the appropriate card and approving the transaction.
The bank then sends a confirmation number to the merchant, who never once has access to the consumer's card number or password.
The idea had enough potential to catch the eye of Martin Bouchard, CEO of Copernic, one of Quebec's brightest stars on the Web. Martin Bouchard sits on Othentik's board of directors.
The solution has yet to be marketed. "Negotiations with certain financial institutions are at a fairly advanced stage," says Othentik president Patrick Rioux.
A report due from the Canadian Payments Association on March 31 is expected to get the ball rolling by establishing the national regulatory framework for electronic payments. "At that point, the banks will feel justified in adopting such a system," believes Rioux.
Discussions with merchants are also going smoothly. "This is by far the easiest part of the process," states Rioux. "Merchants are on board straight away because such a proposal frees them from all liability in the event of fraud. The minute users log onto their online bank accounts, the responsibility falls entirely upon the bank."
Jean-François Codère - Journal de Montréal - March 3, 2003
http://www2.canoe.com/techno/nouvelles/archives/2003/03/20030303-114144.html
