Online transactions gone bad continue to rise

Industry

Published: 25 Jan. 2021, 18:11

Online transactions gone bad continue to rise

After purchasing a 7-million-won ($6,360) travel package via an online shopping platform in January last year, a customer was not able to get a refund after canceling due to the pandemic.

He sent a damage relief application to the tourism company and the online shopping platform through the Korea Consumer Agency, but it was returned, and he’s still out of money.

In a study published by the Korea Consumer Agency on Sunday, conflicts between consumers and online shopping platforms over the past five years were analyzed to determine the type of conflicts and the reasons for the conflicts.

The number of relief applications it received totaled about 69,452. Of them, 12,974 were made last year, up 7 percent compared to a year earlier.

Applications related to airlines totaled 5,898. Some 3,274 applications were made about investment consulting services, while 2,094 were made related to overseas travel.

For airlines, a total of 2,187 damage relief applications were filed last year alone, more than a two-fold jump on year, mainly due to the cancelation of flights due to the prolonged coronavirus pandemic.

By types of damage, some 63.6 percent of applications were related to contract disputes, 5.1 percent about service quality and after-sales service while roughly 3.6 percent were about safety issues.

It also turned out that 15.8 percent involved the nine big players: 11st, Naver, Auction, WeMakePrice, Interpark, Gmarket, Coupang, Kakao and TMON.

Of them, some 40.8 percent of consumers were not able to receive full compensation due to unidentified sellers or sellers who dropped off the grid.

Some 1,500 people applied for damage relief related to conflicts with overseas sellers, but 48.2 percent were not fully compensated.

“Online platforms must actively mediate the relationship between sellers and consumers by fully revealing the personally identifiable information about the sellers,” the Korea Consumer Agency said in the analysis. “In the case of foreign businesses, they must hire a representative in the country so that the representative can actively respond to any conflicts with local consumers.”

BY CHEA SARAH, LEE BYUNG-JUN [chea.sarah@joongang.co.kr]