More than half of Chinese web users believe online transactions are unsafe, which has had a significant negative impact on China’s e-commerce development, according to industry experts.

    The China Internet Network Information Center said a recent survey found 50.3 percent of Chinese Internet consumers said they do not believe in making online transactions, and 50.8 percent said they often encounter fake and exaggerated information online.

   “The Internet in China has a credit crisis,” said CNNIC’s chief scientist Dr. Mao Wei, according to China Daily. “It influenced the domestic online market, as people tend to stop transactions or log out when they find websites are doubtful.”

   In the first 11 months of 2010, China Anti-phishing Coalition traced and handled a record high of 20,570 phishing websites, an increase of 136 percent compared with the same period last year. Approximately 75 percent of these websites were involved in fraudulent online trading, China Daily reported.

   One case of fraudulent activity includes a man who set up a website to sell fake cigarettes online, making a profit of more than $754,637 before he was arrested.

   Because of the credit crisis, many sellers may lose potential customers because they cannot prove they are trustworthy, Wei said. He estimated phishing activities have cost China more than 7.6 billion yuan this year.

                                                                                                     Source:The New New Internet