SMEs 'put off e-commerce' by fraud worries

Worries about credit card fraud remain a significant factor behind poor uptake of e-commerce by small and medium sized enterprises (SMEs), according to the Federation of Small Businesses (FSB).

Following this month’s report on e-crime by the House of Lords Science & Technology Committee, the FSB said only 18% of UK SMEs were trading online in 2005, while less than 1% were generating all their sales through the web.

Although only 6% of small firms had experienced online credit card fraud, its threat was a significant concern to 19% of businesses, the FSB added.

It backed recommendations in the committee’s report, including increased research into e-crime, as well as allowing victims to report incidents to the police and receive a crime number in return.

It also said banks should take more responsibility for losses sustained through electronic fraud.

David Croucher-Jones, FSB home affairs chairman, said:

“E-crime needs to be given the same status as crime that is committed against a bricks and mortar business. Only when this is accomplished, by implementing the Lords recommendations, can more small businesses benefit from having a stronger online presence."

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