Some 55% of UK consumers are concerned about spending money on social media due to fears about fraudulent sellers, according to a new report by financial technology firm FIS.
The research reveals that fraud is now the top concern deterring UK consumers from shopping via social media, and 42% of UK consumers do not trust social media platforms with their data.
The news comes during the same week that the City of London stated that investment fraud has risen by 49.5% in the past 12 months, with many victims now being targeted on social media.
While older consumers were most concerned about fraudulent sellers, less Gen X consumers were worried than millennials, with 55% of Gen X’ers expressing concern compared to 59% of millennials.
However, Gen Z are the least likely to be deterred from shopping on social media with only 46% saying that they worried about falling victim to fraud on social media. In fact, 78% of Gen Z and 70% of millennials say they are likely to make a purchase directly through a social media platform in the next 12 months.
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Conversely, 61% of Baby Boomers are not likely to make purchases through social media platforms in the next year, and 18% of consumers believe social media platforms encourage them to spend beyond their means
The report also explored attitudes to shopping in the metaverse, with 43% of shoppers across all generations saying they are likely to access the metaverse in the next 12 months.
However, only 21% of Baby Boomers plan to use the metaverse over that time, compared to 62% of Gen Z consumers.
Those willing to make purchases in the metaverse in the next 12 months said they would be open to buying event tickets, 43%, buying games or gaming tokens, 42%, and banking services, 31%, including investments, insurance and loans within the metaverse.
“Social media, and other online platforms, are increasingly popular with UK consumers, particularly younger generations,” FIS senior vice president banking and payments Europe Silvia Mensdorff-Pouilly said.
“In fact, our data shows 78% of Gen Z and 70% of Millennials say they are likely to make a purchase directly through a social media platform in the next 12 months.
“However, the findings also show us that consumers are becoming more aware of the risks of fraudulent sellers, and this is causing them to think twice about purchases on social sites.
“Transacting through existing and emerging digital channels are going to continue to proliferate and consumers need to be able to spot the genuine from the disingenuous in these situations.”
