Fear of giving credit card numbers over the Net

unfounded compared to risk of phone, mail, fax Apr 29 1997

The Net seems to attract more than its fair share of paranoia from the media: On a more or less daily basis, we can read, hear or view pieces decrying hackers, pornography, cults, terrorists and sexual predators loose on the Net. Somehow, porn in the corner grocery is seen as normal, while its availability on-line is newsworthy.

One of the big stumbling blocks in the growth of on-line sales over the Net is a public perception that it's dangerous to type a credit card number into a form on a Web page. Can we know who has access to that information as it passes through multiple computers on its path from sender to recipient? BIV reader Jonathan Chilvers, of Mayne Island's Oceanwood Country Inn ( is not alone in worrying about this.

He wrote: "As keepers of a small country inn, we take guests' credit card numbers for deposits to guarantee bookings. Everybody seems totally happy to divulge this information over the telephone or by fax. But some people feel that horrid things may happen if they put their number in an e-mail message.

"Since it therefore appears that their mistrust is not of me, what could go wrong for them? Is it indeed more risky to send your credit card number by e-mail than by phone, mail or fax? Or more risky than leaving credit card slips bearing your number, name and signature in any store or restaurant you patronize?"

In fact, Jonathan Chilvers is correct -- most of us happily engage in risky behaviour with our credit cards every time we give the number over the phone, or even when we let a restaurant server take the card out of our sight to the cash register; in fact, there is probably a higher risk of our number being abused in these ways than over the Net. Nevertheless, because the Net is new and still a mysterious medium to most, users remain apprehensive. As a result, merchants trying to carry out business over the Net are making efforts to ensure that these transactions are more secure than the ones we all take for granted using more traditional means.

Festival Distribution Inc. (FDI) is a Vancouver-based CD distributor that grew out of the Vancouver Folk Music Festival. This winter, they set up a Web site ( as an adjunct to their existing mail-order business. When you think of folk music, the Internet is probably not the first thing that comes to mind. Acoustic guitars, maybe granola -- but not high tech. But like Oceanwood Country Inn and other Web-sales sites, they've had to worry about security. According to FDI's Jack Schuller: "We now have the standard scrambler security set up on the site. I think that it is interesting that credit card security on the Net is such an issue when we receive daily phone orders from people all over the world who do not have any problem giving their card number over the phone lines. How secure is that? In the three and a half years that we have been developing the mail-order business, we've had one problem with a customer that was indirectly related to a credit card. Someone wanted to surprise a friend with a CD ordered from us. The friend flew into a panic [thinking his] card had been stolen. Really, the Web is unbelievably smooth.

"The Web is proving to be interesting.... [W]e have had about 4,000 hits over six weeks. Most people look at our spotlights and often download the sound bytes. Not very many people access the catalogue or order. We have had more success advertising the fact that we have a print catalogue on various newsgroups -- folk, blues, Celtic, bagpipes, world etc."

Notice what seems to be a common theme -- people are more likely to use the Web as a source for information and entertainment, so make sure that your business's site is informative and entertaining. (FDI is busy adding sound bytes and pictures of its artists.) But when it comes to actually making a purchase, many Web users are more comfortable browsing a print version of your catalogue, picking up the phone or sending a fax. Last year, a U.S. survey found that only 10 per cent of current Internet users reported having made an on-line purchase.

In fact, a more recent survey suggested that a solid majority of on-line consumers -- a full 60 per cent -- said that they didn't trust giving out personal information to Web-based merchants. As a result, when faced with an on-line form, 41 per cent go somewhere else, while 27 per cent reported simply filling in the form with lies.

Faced with that sort of customer suspicion, don't be surprised if posting your catalogue on the Net doesn't immediately translate into big bucks in on-line orders.*

Search WWW Search

Alan Zisman is a Vancouver educator, writer, and computer specialist. He can be reached at E-mail Alan