Online shopping: don’t let the fear of fraud put you off

In fact, recent figures from the UK Cards Association show that credit and debit card fraud has actually fallen to a 10-year low. Losses on UK cards fell by 17pc during the last year and the industry body credits the downward trend to schemes set up by the banking industry, such as Verfied by Visa and MasterCard Secure, which have increased consumer awareness and helped prevent fraud.

For those who are worried about using your credit or debit card online for fear that your details may fall in the wrong hands, you can use a prepaid credit card.

This type of card allows you to pre-load it with cash – typically up to £5,000 – which is not registered to your bank account or home address. Meaning, that like a pay-as-you-go mobile, if it was used fraudulently, only the money on that card would be at risk.

You can be load money onto the card by cash at a bank, post office, at pay zone or PayPoint terminals, bank transfer, or even by another credit card. But bear in mind that these cards can cost anywhere from £4.95 to £10 upfront and some cards charge monthly fees, while others impose a charge of about 3pc for each purchase.

Another way to pay online with confidence is with PayPal (www.paypal.co.uk), which will allow you use your credit card, debit card or your bank account securely, without handing over your financial information to different parties every time you make transaction.

Online shopping hit monthly record in December

Britain’s internet shopping spree hit a record monthly high of £6.8bn in December as consumers turned to their computers rather than brave the snowy high streets.

Sales of clothing and alcohol ordered online rose particularly sharply, according to the IMRG Capgemini e-Retail Sales Index. It reported that UK shoppers increased their web spending by 7% last month compared with the month before, and by 25% more than in December 2009.

The report showed the extent to which the wintry weather affected spending patterns last month. This boosted retailers with a strong web presence, but hurt those more dependent on visitors to stores – and led to profit warnings from HMV, Mothercare and Comet’s owner Kesa.

Online spending on clothing, footwear and accessories was 40% higher than in December 2009, while the amount spent on beer, wine and spirits rose by 36% year-on-year.

UK shoppers spent a total of £58.8bn online in 2010, 18% more than in 2009. Spending is expected to increase at the same pace this year, to a total of £69bn.

“The ongoing trend of consumers putting down the car keys and turning on their computers is only set to continue, particularly as consumers use the power of the web to make their money go further as the economy recovery remains fragile,” said Chris Webster, head of retail consulting and technology at consultants Capgemini.

The survey suggested that many consumers have become more confident about shopping online, with clothing retailers reporting a 50% increase in “conversion rate” – a measure of how many visitors to sites actually place an order.

December’s bad weather disrupted transport links, forcing many retailers to suspend online orders or offer refunds. However, IMRG chief executive James Roper said this did not appear to have dented customer confidence. London Online Shop