Jun 2018 | Articles |

According to our recent Digital Consumer Insights 2018 report, e-commerce in the Asia-Pacific (APAC) region is thriving – with the majority of APAC consumers (71%) partaking in online purchases. But the risk of fraud is proving equally prolific, with one in five customers already experiencing detrimental breaches of their data.


The report, co-authored with advisory firm IDC, is based on an extensive consumer survey of 3,200 people across ten APAC markets, and delves into how well businesses prevent and deal with fraud risks – predominantly through the eyes of their customers.


What we found is that APAC is one of the world’s most dynamic digital and mobile economies. But constant demand for easier e-commerce journeys – particularly regarding electronics, travel and grocery purchases – is driving the opportunity for online fraud.


In emerging markets like Thailand and India, convenience is king, and mobile-led consumers therein are less aware or concerned about risk. However, more mature economies like Australia and New Zealand boast different priorities: Consumers want convenience, but are more aware of fraud risks and therefore act more conservatively.


This is highlighted by the fact that in these latter countries, customers are especially cautious about sharing their personal data in perceived risky environments (for example, public WiFi networks). And the consequence for businesses? Well, the report found consumers in Australia and New Zealand are among the least tolerant to a fraud incident (84% and 88% respectively).


Transformative technology

The unfortunate reality though, is that the more digital convenience we enable, the higher our fraud exposure – a major problem for both consumers and businesses across APAC. But there is a silver lining.


The report also shows that as we improve consumer understanding about the risks of fraud, consumers are more likely to be open to adopting security measures – including biometrics like fingerprint, facial and voice recognition.


In APAC, 13% of consumers are already willing to adopt biometrics (followed by 9% in Australia and 8% in New Zealand). Plus, the majority (57%) of APAC respondents noted that they are particularly comfortable with biometrics in government/non-commercial applications, while a substantial 38% of Australians and 37% of New Zealanders are willing to share their data to enable better protection against fraud.


As this prioritisation and acceptance of fraud protection measures grows, biometric data will increasingly be able to improve customer experiences and enhance security.


Data predicament

But until this acceptance becomes more ubiquitous, how can organisations in Australia and New Zealand protect their customers knowing they are among the least tolerant of fraud? 


One way for businesses to manage fraud is by gaining greater understanding of consumers’ openness to share personal data to drive data-driven fraud detection measures. The report found that on a whole, consumers are willing to reuse their data between companies – the top reason in the overall APAC region being fraud detection, which is 16% more than sharing for the sake of convenience.


However, there are 5% who intentionally submit wrong information and one-fifth have made errors in the information they provide companies. This indicates a gap of knowledge and trust between companies and consumers, and the onus is on companies to be able to properly communicate the value of data to customers in ensuring their safety and create trust.


Increased levels of consumer education and transparencies of data sharing will allow businesses to not only manage fraud better, but also increase their accuracy of the single customer view – delivering better and more relevant services and products from businesses and strengthening the cycle of data sharing and, ultimately, the provision of convenience.


For more insights, download the Digital Consumer Insights 2018 report or visit Fraud and Identity Solutions to learn about how Experian can help you safeguard your business and your customers from fraud.