Five ways to increase trust in e-commerce.

Byline: Ioannis Lianos and Kimberley Botwright

Trust between consumers and suppliers is often a bigger issue online than it is offline.

Online, there is a limit to both physical interaction and the opportunity to test the professionalism of a retailer or suppliers. According to one survey of 24,000 internet users in 24 countries, 22% said they never shop online - and of those, 49% gave lack of trust as the reason.

Not unsurprisingly, developing online trust gets more complicated when a consumer is in one country and a supplier is in another. Consumers might not be sure that they benefit from the same protections. Will their card details be handled safely, and will they be able to return a faulty item? In some cases consumers may not realise they are shopping abroad.

From a supplier's perspective, low levels of cross-border trust can impact export opportunities, particularly for small businesses without global brand power. Unclear rules on consumer trust can equally cause uncertainty around compliance, and it can be cumbersome to adapt to different approaches between countries.

Based on insights from a new white paper, The Global Governance of Online Consumer Protection and E-commerce, here are five ways policymakers can increase trust in e-commerce.

1. Create relevant online consumer protection rules

   While most countries have a legal framework for consumer protection, just 52% have updated theirs to cover online activities, according to the United Nations Conference on Trade and Development (UNCTAD) CyberLaw Tracker. For other countries, laws are at the draft stage; there is nothing on the books, or no information is available.

2. Focus on personal data protection

   Many stakeholders also consider rules protecting personal information to be part of the online consumer protection toolkit - particularly relating to information in a business-to-consumer (B2C) exchange. According to UNCTAD, 58% of countries have rules in place while 21% do not, with data falling short on the rest.

   Research suggests that these measures play a role in boosting online trust. In a survey by KPMG of 18,000 online consumers in 50 countries, 41% of respondents said having control of how their personal data was used was more likely to make them trust a company, especially in North America, Europe and South Africa.

3. Address variation in the rules

   Online consumer protection rules can cover all aspects of a B2C relationship, starting from before the purchase is made to...