There is no such thing as 100 per cent security when it comes to online transactions, regardless of what suppliers say.
This was the message given by Roger Alexander, head of emerging markets group for Barclays bank at the IDC ecommerce forum in Monte Carlo this week.
"If [vendors] here tell you that, tell them to put their money on a casino down the road," he said.
The Secure Electronic Transaction (SET) standard that hardware companies and banking organisations have been working on has "created a technically elegant solution, but a logistical nightmare," he said. It is proving expensive to develop and support, and interoperability is a challenge.
"SET is likely to have a short life," predicts Alexander. This is the primary reason why Visa and Mastercard are looking for token based solutions, he claimed.
Banks who are out there waiting for SET to solve their online banking problems should forget it: "It is not the answer to the proverbial maidens prayer. Don't wait for it."
Fraud still has financial institutions "running scared" from the Internet: "They have no control," he said.
Some retailers in the US are refusing to sell overseas because they cannot get address verification and are worried about duties and customer service, according to Alexander.
The biggest concern for banks right now is the existing status quo on security and finding ways of adding value to consumers across boundaries.
Alexander believes that an answer will be found for secure transactions, but he said that banks have to experiment and get their hands dirty.
"The chance of success gets less day by day. The further down the road you get the harder it is to change the business model," he said.
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