Online payment may replace credit cards

JAKARTA (JP): The recent arrests of several Internet thieves in Yogyakarta had at least two effects on us, Indonesians.

The first, which was very saddening, was that they put us in deeper disgrace. They expanded the already long list of undesirable attributes that we, Indonesians, have to live with by adding "cybercriminals".

The second was that it made us more aware that the Internet is not at all a safe place. Just like your wallet as you walk across the overhead pedestrian bridge in Dukuh Atas, Central Jakarta, where pickpockets are rife, data and information can be highly susceptible to interception and theft.

Indeed, credit card theft is the second largest concern of Internet users everywhere after child pornography, according to a recent poll in the U.S.

Another survey by GartnerGroup also revealed that the number of credit card fraud incidents were 12 times higher on the Web -- where storekeepers do not come face-to-face with the shoppers -- than in the bricks and mortar world.

And the victims of credit card theft are not just ordinary people like us. In December 1999, ZDNet News reported the confession by Eric Schimdt, CEO of the network stalwart Novell, that his credit card number had been stolen.

This showed how everyone is vulnerable on the Internet. Just because we surf the Internet and make our purchases from the comfort and relative safety of our home, it does not mean that the Internet is free from crooks.

Unfortunately, new websites emerge every day that make shopping on the Internet so easy and so much fun. Auctions, discounts, direct factory outlets, special offers, all conspire to make online shopping so irresistible.

The Internet could actually be a safer place for shoppers if strict standards were applied by all e-commerce businesses. There are tools and methods available that can help reduce online frauds.

These include address verification systems, customer follow- up, real-time authorizations and post-process fraud management. These are not free, of course, and the thin margins caused by cutthroat competition on the Web makes the majority of online stores hesitant to use them.

Some online stores have apparently been too eager to make sales that they do not pay enough attention to entries in the "Ship to" or "Deliver to" boxes, which could have raised their eyebrows.

Does it make sense if some credit card owner in Germany orders a pair of high-end shock absorbers to be couriered to someone in a remote town in Central Java, Indonesia?

It might, but at least it should have raised the yellow flag.

What should we do? First of all, common sense will tell us that we need to be very selective in giving away our credit card numbers.

However, as we get accustomed to using the plastic money, caution usually wears down. We simply should not let this happen.

Second, we need to check our credit card bills carefully the moment we receive them and spot any strange purchases from unfamiliar stores.

Unfortunately, however, reporting that someone else has abused our credit cards will also mean time wasted and a lot of headaches.

One potential solution is to use third party services such as PayPal from X.com (www.x.com). Services like this are collectively called personal payment services.

However, an increasing number of e-commerce sites have been signing on to this service, making online shopping easier and safer for us.

So far, PayPal's service is still free, and if you are interested in trying to send cash by e-mail, you can open your account and try it out.

PayPal even allows Palm PDA users to beam cash over the Net. Some people even enthuse that online payment services like PayPal, payMe.com, eMoneyMail and Ecount may eventually replace our credit cards. Let's see.

-- Zatni Arbi