IMPROVED CYBERSECURITY and data security measures — including the adoption of a Privacy by Design (PbD) approach — can create a privacy-oriented retail environment, in turn building trust among consumers, according to a fintech expert.
PbD is the integration of privacy in the creation of devices, infrastructure, and policies. Examples of it include the end-to-end encryption of the messaging app, WhatsApp, as well as the differential privacy efforts of technology giant Apple, which helps prevent the extraction of data by adding noise to it.
This approach can also be practiced by family-owned stores, says Aleksei Kosenko, the president of UnaCash, a financial solutions provider that offers Buy Now, Pay Later (BNPL) services to merchants.
“It is practical for small businesses like mom-and-pop shops to follow PbD principles, even with limited resources,” he said in a Feb. 5 e-mail.
Mom-and-pop shops can tailor this to a minimum, he said, by “using tools to protect data without exhausting resources, and being clear in cascading data privacy rules on simple terms through their respective platforms [such as their website and social media] to secure data.”
Mr. Kosenko told BusinessWorld that embracing PbD early on helps build confidence among consumers, while shielding the business from data-related risks.
ONLINE RETAIL GROWTHA November 2023 study by UnaCash found that the gross merchandise value (GMV) for BNPL purchase options is expected to increase by 173% in 2024.
The e-Conomy SEA report by Google, Temasek Holdings, and Bain & Co., meanwhile, projects a $24-billion GMV for Philippine e-commerce next year, surging to about $60 billion by 2030.
GMV is the total amount of sales a company makes over a specified period.
Statista, a market data portal, estimates that the number of e-commerce users in the Philippines will reach 60.41 million in 2027.
The Philippines’ gains in digitalization highlights the need for a balance between retail transformation and data protection, Mr. Kosenko said.
“We anticipate a sophisticated retail system, where predictive analytics and learning will not only enhance operation efficiency but also contribute to privacy-preserving solutions,” he e-mailed in a Jan. 31 statement.
The foremost goal for companies, he said, is the reduction of data breaches and online attacks through the implementation of a compliant data center infrastructure.
“This has a higher chance of security and is a holistic approach to data protection in the retail sector,” added Mr. Kosenko.
“Over time, a significant number of e-commerce players in the Philippines may adhere to the principles of PbD,” he also said, which “underscores the importance of prioritizing data confidentiality… to safeguard a robust data security ecosystem.” — Patricia B. Mirasol