Are consumers safe in the digital age?

E-commerce is expanding. Data gathered by the OECD (Organisation for Economic Cooperation and Development) from its member countries reveals that the percentage of consumers purchasing products online increased from about 25 % in 2007 to 32 % in 2013.

Growth in other countries, such as China and Brazil, is even higher. Brazil’s online sales showed an increase of 26 % between 2010 and 2011, while Chinese growth soared by a staggering 500 % in 2011, compared with 2008. In addition, purchases made using mobile devices are booming, as is mobile banking. While they do make consumers’ lives easier, these consumption patterns raise challenges to consumer protection and product safety. International Standards play a crucial part in keeping consumers safe, providing a foundation for government policies, which often lag behind market developments.

Lack of legal measures.
A survey conducted by the consumer rights group Consumers International (CI) in 60 countries maps out the state of consumer protection around the world. The report reveals that barely half the countries surveyed (52 %) have a national consumer protection policy and less than a third of governments (29 %) have proper mechanisms in place for resolving e-commerce disputes out of court. Legal measures are spreading, but implementation is weak, so standards are needed to underpin legislation.

A prime example of a standard that can instigate change is ISO 10008:2013, Quality Management – Customer satisfaction – Guidelines for business-to-consumer electronic commerce transactions. Published in May 2013, the new standard helps set up a fair and transparent e-commerce platform that will enhance consumer confidence in e-commerce transactions. Input by ISO/COPOLCO, the ISO Committee on consumer policy ensured that consumers’ rights were indeed taken into account.

Mobile banking and payment

In today’s highly volatile financial marketplace, security of mobile banking and payments is another very real concern for consumers and financial service providers. According to Gartner, Inc., the world’s leading information technology research and advisory company, worldwide mobile payment transactions will have reached USD 235.4 billion by the end of 2013, featuring a 44 % increase from 2012 values of USD 163.1 billion. And the number of mobile payment users will have totalled 245.2 million, up from 200.8 million in 2012. In this context, banking institutions and mobile marketers face the daunting challenge of ensuring the security of applications and technologies in order to minimize the risk of security breaches and information thefts.

Work on future standards (ISO 12812, parts 1 to 6) for mobile financial services (under the aegis of ISO technical committee ISO/TC 68, Financial services, subcommittee SC 7, Core banking) will contribute, with the participation of consumer representatives, to eliminating some of the uncertainties faced by both consumers and businesses when buying and selling online.

Market surveillance and the importance of standards

With the expanding online market, consumers can find it a challenge to keep up with new products and innovations, which may or may not conform to existing standards. This is where market surveillance comes in. Market surveillance is the work carried out by public authorities to ensure that products comply with the requirements set out in the relevant legislation. Market surveillance is about the prevention of future problems and accidents, including fatal ones. For ineffective market surveillance has an impact on the number of fatalities.

The key to effective market surveillance is data collection. In October 2012, the OECD launched the GlobalRecalls portal (to help consumers who have purchased globally sold products to access recall information at a single point. The new information bank comprises recall data from Australia, Canada, the USA and the European Commission and aims to extend to more countries in the future. The GlobalRecalls portal (see globalrecalls.oecd.org) improves the visibility and publicity of product recalls and, most importantly, provides the global view that has become so indispensable in today’s international marketplace.

Standards for product testing and product recall, which include two of ISO’s most recent launches, help make market surveillance more efficient. The recently published ISO 10377:2013, Consumer product safety – Guidelines for suppliers, and ISO 10393:2013, Consumer product recall – Guidelines for suppliers, will help small and medium-sized suppliers in particular to implement effective product recall and corrective action mechanisms to protect their businesses and consumers.

ISO 10393 gives practical advice to companies on how to recall a defective product traded across borders, manage the associated legal risks and build customer loyalty, while ISO 10377 helps manufacturers assess the risk of a consumer product throughout its life cycle. The advice on effective recalls and corrective mechanisms will lead to improvements in product safety and hence consumer protection. The number of mobile payment users will have totalled 245.2 million, up from 200.8 million in 2012. In this context, banking institutions and mobile marketers face the daunting challenge of ensuring the security of applications and technologies in order to minimize the risk of security breaches and information thefts. Work on future standards (ISO 12812, parts 1 to 6) for mobile financial services (under the aegis of ISO technical committee ISO/TC 68, Financial services, subcommittee SC 7, Core banking) will contribute, with the participation of consumer representatives, to eliminating some of the uncertainties faced by both consumers and businesses when buying and selling online. International Standards play a crucial part in keeping consumers safe.

Leading issues in the battle to protect consumers were discussed at the 35th ISO/COPOLCO meeting held in Malta and hosted by the Malta Competition and Consumer Affairs Authority. The workshop entitled “Innovating food products – How standards can ensure consumer protection ” attracted more than 100 participants from over 30 countries. Each year, the ISO Committee on consumer policy (ISO/COPOLCO) holds a workshop on consumer-related matters. Bringing together consumer representatives from around the world, these seminars are an invaluable way of informing the standardization community about the needs of consumers and how standards can embrace these.

Article Credits: ISO focus