Experian’s ‘combined blows’ against e-commerce fraud promotes the healthy development of the platform economy
In China, the internet platform economy is both an emerging form of productivity organisation and a new driver for economic development. On August 8, the General Office of the State Council issued guidelines on promoting the healthy development of the platform economy. It said that the prominent issues hindering the platform economy’s development should be tackled with concentrated efforts. To promote an orderly and healthy development for platform economy, policy guidance, support and guarantee should be intensified according to the law of economy and trends.
As a typical representative of the platform economy, e-commerce’s orderly and healthy development plays an important role in many aspects, including optimising resource allocation, boosting all enterprises’ cross-border and mutual development, encouraging mass entrepreneurship and innovation, promoting industrial upgrading, expanding consumer market, and, especially, increasing employment.
Platform economy sweeps across the globe with great potential in Hong Kong and Taiwan e-commerce Markets
The global e-commerce market experienced strong growth in 2018. According to the E-COMMERCE IN CHINA 2018, a report released by the Department of Electronic Commerce and Informatisation of the Ministry of Commerce of the People’s Republic of China in May 2019, the global online retail turnover was $2.8tr with a year-on-year growth of 23.3%. Comparatively, the global retail turnover in 2018 was $23.9tr and the global online retail turnover rose from 10.2% in 2017 to 11.9% in 2018. Online retail has gradually become an important channel for global consumption, and the platform economy represented by e-commerce is sweeping across the globe, driving an irreversible globalisation trend.
According to the National Bureau of Statistics of China, China e-commerce turnover reached 31.63tr yuan (about $4.72tr) in 2018, and online retail sales surpassed 9tr yuan with a year-on-year growth of 23.9%. As a result, China remains the biggest online retail market in the world. Regionally, e-commerce plays an important role in Hong Kong’s economy. Statista estimates that e-commerce alone will generate $4,800m (about 32.2bn yuan) worth of revenue in Hong Kong in 2019. That figure will increase with a compound annual growth rate of 7.4% from 2019 to 2023, and the market size will reach $6,400m (about 43bn yuan) in 2023. The e-commerce industry has enormous potential over the next four years.
Meanwhile, Taiwan’s e-commerce market has grown rapidly in recent years, with users showing strong online consumption power. Data shows that by February 2018, Taiwan e-commerce industry saw an average annual growth rate of 7.4% in the past seven years, while the overall retail industry’s annual growth rate is only 1.9%. Market research institute eMarketer anticipates that Taiwan’s e-commerce will be able to maintain a 7% annual growth from 2018 to 2022, indicating there is still considerable room for growth and development in Taiwan’s e-commerce market.
Chaos behind prosperity: frequent e-commerce fraud leaves consumers in urgent need of a safe market environment
As e-commerce and mobile payment have become increasingly convenient, new fraudulent means are also emerging. According to a global e-commerce fraud report released by Pymnts.com in October 2017, e-commerce fraud would cause a $58bn loss in 2017. The “Underground Industry” behind e-commerce fraud is widespread, affecting numerous links of e-commerce, including account registration, identity fraud, advertising and traffic diversion, and loan payments.
According to the latest 2019 Global Identity and Fraud Report released by Experian, more than 2 in 5 consumers worldwide have already experienced a fraudulent event online at some point in their lives, with the highest incidence occurring in the United States and the lowest in the Europe, Middle East and Africa region. Even the marketplace that is most effective in mitigating online fraud has potentially left a full third of its digital customers vulnerable.
According to Experian’s 2019 Global Identity and Fraud Report (Asia-Pacific Edition), shopping online for goods and services is the most cited online activity. 50% of businesses surveyed in the Asia-Pacific region reported an increase in fraud losses over the past 12 months from account originations and account takeovers — both potentially damaging to brand reputation. This is slightly lower than the global average of 55%. Over the past 12 months, 16% of consumers in China reported fraudulent incidents with electronic/mobile commerce marketplaces, compared with 8% in Hong Kong. Consumer confidence in businesses’ ability to safely confirm their online identity is moderate. Only 42% of consumers indicated that they have complete or very high confidence, with consumers in Hong Kong and Japan expressing the least confidence — 21% and 13% respectively — with Hong Kong consumers significantly more hesitant to share personal data.
