No, you re not just paranoid. But it might surprise you that outside forces aren t the only ones that threaten your business. For e-commerce sites, losing customers' trust can be a bigger hit to the bottom line than paying to fix security breaches and covering costs for fraudulent purchases. What's more, companies fear, revealing specific damage to their systems may only serve to let hackers know exactly where their weaknesses are. While the threat of online credit card fraud to individual consumers is real, e-shoppers have less at stake than the commerce sites do.
Federal law protects credit card users against fraud online and off.
To make consumers more comfortable shopping online, Visa USA, MasterCard International, and American Express have introduced zero-liability programs that waive all consumer liability in case of online fraud. In fact, consumers shouldn't fear shopping online with a credit card any more than they fear shopping with it over the phone, through a catalog, or at local stores. The fact is, there is not a documented incident of someone's credit card number or personal data being intercepted in transit during a transaction where encryption technology is used, says Allan Trosclair, executive director of the National Coalition for the Prevention of Economic Crime. To be sure, credit cards are the safest mechanism for shopping online, making up 93 percent of online payment transactions, according to the GartnerGroup. Online merchants suffer the brunt of losses from disputed transactions, known as chargebacks.