Carousell introduces new payment system to tackle scams; says such cases account for small fraction of transactions

SINGAPORE - Even though 80 per cent of e-commerce scams in the first half of this year took place on its platform, Carousell said the cases account for only a small percentage of its transactions.

But it added that it has taken steps to tackle the issue, including introducing a new and safer payment system.

The popular online selling platform noted that more than 99.9 per cent of its transactions are fraud-free.

"We take a very serious view towards fraud and actively monitor our marketplace for potentially fraudulent listings, and our proportion of reported scams is a direct result of being the leading online marketplace in Singapore," said a spokesman for the company.

Mid-year crime statistics released by the police on Thursday (Aug 23) showed that the number of e-commerce cheating cases went up by 58 per cent. There were 1,277 cases in the first half of this year, up from 808 cases. Victims were cheated of some $930,000.

About 80 per cent of all e-commerce scams take place on Carousell, police said.

Responding to media queries, Carousell said it has recently launched a new and safer form of payment system, called CarouPay.

Launched in June, CarouPay, an escrow service, freezes and holds on to funds in the event of a dispute, such as when buyers do not receive their purchases from the sellers. The money will be released only when the two parties have reached a resolution.

This could help address a common method of e-commerce scams, where buyers do not receive their purchases, as sellers disappear after receiving their payment.

"The new payment system not only makes transactions hassle-free but also provides greater assurance by allowing insight into fraudulent transactions. This allows us to help our users settle disputes and get their money back," said the spokesman.

The company said it also uses technology and artificial intelligence to identify potentially fraudulent activities on its platform.

In addition, it runs educational campaigns and has dedicated teams that look out for suspicious activities on the platform.

In their press release on Thursday, the police advised consumers to exercise extra caution when they come across unrealistic bargains for goods such as concert tickets, apparel and electronic products.

Consumers should buy only from reputable sellers and vendors, and check the track records of the seller, said the police.

Earlier this month, a 23-year-old woman was arrested for her suspected involvement in a series of ticket scams. Police had received 16 reports about the scams between July and August, with victims cheated after being taken in by Carousell listings for tickets to the National Day Parade and and JJ Lin's concert.