Online savers have to face a hard lesson about the risks of trans-national internet banking. UK savers attracted to the high interest rates offered by the [Iceland based] Icesave online account have found their assets unexpectedly frozen, following the insolvency of its parent company, Landsbanki.
It is too early yet to unpick the broader implications of this failure on online consumer confidence. Trust is hard-won and quickly lost when it hits people in their pockets.
In the brick and mortar world, empty shops are easy to spot on the high street. But closed shops don’t usually cost customers, apart from lost shopping opportunities; whereas online retailing and services are usually pre-paid, leaving consumers exposed to real losses.
