Opinion Former Article

FSB: Small businesses put off engaging in e-commerce.

The Federation of Small Businesses (FSB) has highlighted the significant numbers of small and medium sized enterprises (SMEs) being deterred from e-commerce, following a report by the House of Lords Science & Technology Committee. Despite the fact that the geographical reach of the Internet makes it possible for SMEs to compete in the global market at low cost, just 18% of SMEs are selling on-line. Less than one percent of those derive all of their sales through the Internet.

The risk of credit card fraud is a significant concern to 19% of businesses, yet only 6% have actually experienced on-line credit card fraud.

Recent recommendations made in a report on Personal Internet Security by the House of Lords Science & Technology Committee, many of which are backed by the FSB, include increased research into e-crime as well as e-crime victims having the opportunity to report Internet crime to the police and to receive a crime number in return, just like any other type of crime.

The FSB supports work to establish a national e-crime co-ordination unit with the Metropolitan Police and applauds efforts by organisations such as GetSafeOnline to engage with small and micro-businesses.

The FSB also supports recommendations for legislation that banks should take some responsibility for losses incurred as a result of electronic fraud. Many small businesses and online retailers are caught by charge-backs from card fraud which they often receive months down the line, even after they think a transaction has been successfully processed.

David Croucher-Jones, FSB Home Affairs Chairman, said:

"The extent to which the UK's SME sector is engaged in e-commerce is an issue of considerable economic significance. We applaud the Lords Committee for having highlighted and recommended proposals that are essential to Internet trade moving forward - but recommending and doing are two different things.

"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. Customers will also benefit from the increased choice and convenience that online security can bring."

ENDS

Notes to Editors:

1. The statistics in this press release were taken from the FSB's members survey, which received over 19,000 responses 'Lifting the Barriers to Growth 2006', which can be found at:

http://www.fsb.org.uk/data/default.asp?id=381&loc=policy

2. The full 5th report by the Lords Science & Technology Committee, can be found here: http://www.publications.parliament.uk/pa/ld200607/ldselect/ldsctech/165/165i.pdf

3. The FSB is Britain's biggest business organisation with over 205,000 members. It exists to protect and promote the interests of the self-employed, and all those who run their own business. More information is available at www.fsb.org.uk.

Contacts:

For interviews with FSB Chief Spokesman Stephen Alambritis or other senior FSB personnel please contact the FSB Press Office.

FSB Press Office
Matthew Knowles: 020 7592 8113 / 07917 628991

Simon Briault: 020 7592 8128 / 07917 628998

Belinda Webb: 020 7592 8121 / 07825 125 695

For regional FSB contacts please go to www.fsb.org.uk/regions

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