Even though most online fraud is confined to Internet auctions, most consumers seem convinced that the problem is far more widespread. They fear that as soon as their personal and card details are entered on
to a site, a malicious intruder will be able to view and make use of the information. Although in reality this
type of scenario is highly unlikely, consumers clearly need more reassurance over the safety of e-shopping.

Over the past couple of years, a number of secure e-payment systems have been introduced, with varying degrees of success. Securicor's Safedoor secure e-shopping portal failed to make headway and closed earlier this year. Under this scheme, the online transaction would take place between the Internet retailer
and Securicor, which stored the necessary consumer data offline. E-wallets have attracted some supporters, and could gain more backing when Microsoft launches a revamped offering in the coming months.

Online merchants could make use of available technology to guarantee user identity and prevent credit card charge-backs. After all, it is the merchant who has to cover the cost of any fraudulent card-not-present transactions.

E-payment providers offer a range of anti-fraud technology, for example systems that calculate the level of risk associated with each transaction according to geographical location, shipping data and spending limits.

However, no single solution has become the de facto standard for secure e-payments. To be truly successful, a system would need to offer reassurance to both consumers and merchants, and be easy and economical to set up. It would have to allow consumers to access any Web site, not just authorised ones.

There are, in fact, two systems available that come close to meeting these requirements. Visa and MasterCard have developed similar, yet separate, e-payment authentication systems that aim to protect Internet merchants and consumers. Both systems have the potential to cut Internet fraud and allay consumer fears over the risks attached to online transactions. But what is more encouraging is that Visa and MasterCard are looking into combining their technologies.

By working together to promote a single standardised approach to e-payments, and encourage issuing banks to join up to the scheme, they would make a real difference to the popularity of online shopping. Such a system would prove popular with consumers, as it would have the backing of two major payment companies and would not require any extra effort on their part, aside from entering the required PIN number on the
e-commerce site when prompted.

Consumers are currently confused over the safest approach to online shopping and are therefore wary.
Visa and MasterCard are tantalisingly close to solving this problem.

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