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June 14, 2011

Consumers are most confident in banks to protect personal information according to a joint study by ThreatMetrix and the Ponemon Institute.

Results across four industries showed consumer confidence, after banks, is highest with credit card and payment processors, and social networks, while online businesses were perceived as the worst at protecting personal information.

ThreatMetrix is a provider of cloud-based fraud prevention solutions that do not require personally identifiable information.

 “It’s logical that consumers should have the most confidence in the banking industry’s ability to protect their information online, as banks have a responsibility to protect their customers’ funds,” said Reed Taussig, president and CEO, ThreatMetrix. “Social networks, however, surprisingly have a higher consumer confidence ranking than online businesses in regard to protecting personal information. That represents a problem for the e-commerce industry, which relies on secure online transactions as the foundation of their business model.”

The survey found that the perception of a company’s ability to prevent fraud weighs heavily in a consumer’s online decisions. Three in four consumers said they would not do business with an online merchant if they had doubts about the site’s security measures. Eighty-eight percent said the same of banks or credit card and online payment processors, and 56% for social networks.

“Banks, online businesses, social networks and payment processors are all targets from fraudsters who phish their accounts for emails and passwords,” said Taussig. “Yet when you bring e-commerce transactions into the picture, consumers are still very wary about the security of that data. Banks understand the importance of communicating these fraud prevention measures, which online businesses must also do. It’s the first step to increase that level of confidence to the point where a consumer is willing to complete a transaction.”

Eighty-five percent of survey respondents said online merchants, banks, social networks, and payment processors should be more aggressive in preventing fraudsters from stealing consumers’ information. Similarly, 80% believe these industries should leverage technology to improve authentication of consumers.

Yet not only are consumers indicating these industries need to take extra steps to combat online fraud, but 81% said they would be more willing to use a bank, credit card company or payment processor if they were notified that the organization was taking additional measures.

For more information please go to:
http://threatmetrix.com/consumers-rank-social-networks-better-than-online-businesses-for-ability-to-protect-personal-information-and-stop-online-fraud/

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