Aussie online shoppers face fraud risks amid festive sales

New research from PayPal highlights the online shopping trends and fraud risks facing Australian consumers as the festive season approaches.

A staggering 91% of Australians intend to purchase at least one gift online this year, with 67% planning to source half or more of their gifts online. The appeal of end-of-year discounts is strong, with 65% of Australians planning to take advantage of these sales. Black Friday is notably popular, with 50% poised to participate, including 72% of Gen Z and 65% of Millennials.

The research indicates that Australians are opting for online sales in a bid to manage festive spending, avoid crowded stores, and find competitive deals. Specifically, 49% of respondents cited maintaining Christmas expenditure as a reason for shopping online, 49% wanted to avoid in-store crowds, 48% appreciated easier price comparisons, and 47% valued better deals offered online.

Despite the benefits of online shopping, there are notable risks associated with this convenience. PayPal underscores the existence of fake websites and scam promotions that could deceive shoppers. The National Anti-Scam Centre noted an uptick in fake websites mirroring authentic online retailers, leading to over AUD $500,000 in losses last year.

PayPal's findings reveal that nearly a third (30%) of Australians have visited a counterfeit retail website. Fraud and personal data security remain significant concerns, with 79% of Australians more anxious about their data security compared to last year. Alarmingly, 74% of respondents have abandoned an online purchase due to these security concerns.

A widespread experience with fraudsters was reported by 91% of Australians, with many receiving scam emails (77%), calls (72%), and texts (71%). Gen Z, in particular, is susceptible to fake websites, with 44% encountering such fraudulent sites, surpassing the national average.

Additionally, 70% of Gen Z individuals reported exposure to scam emails, and 67% received scam texts from entities masquerading as legitimate businesses. Gen Z's use of unsecured free Wi-Fi networks further exacerbates this issue, with 51% admitting to this risky behaviour, the highest across all age groups.

Dan Grant, Consumer Shopping Expert at PayPal Australia, advises consumers to remain cautious during the sales period. He stated, "The end of year sales are a great way to snag a bargain and online shopping is definitely the most convenient way to access deals across multiple outlets, do quick price comparisons and organise deliveries. However, Aussies should be extra vigilant during the sales period and recognise the signs of fake deals and sites. Slow down, use trusted payment methods and always trust your instincts – if a deal looks too good to be true, it probably is."

PayPal has provided several tips to help Australians shop safely this holiday season. These include avoiding public Wi-Fi, using secure payment methods such as PayPal, being sceptical of too-good-to-be-true deals, and steering clear of suspicious links. Monitoring financial statements for unauthorised transactions and enabling two-factor authentication are also recommended. Additionally, shoppers should be aware of the tell-tangible signs of fake websites, such as missing contact details, poor grammar, and unsecured payment options.