[PRESS RELEASE] Social Commerce and its Risks for Consumers | Digital Experts Talk #8

Yogyakarta, 20 April 2022 – Social commerce facilitates various commercial activities through platforms such as social media in the consumer shopping process, the interaction between merchants and their customers, and the exchange of information about products or services. In essence, social commerce provides convenience for transactions, although it needs to be observed and mitigated how consumer protection is in these transactions.

In Digital Expert Talk #8, the Center for Digital Society (CfDS) discussed the results of its latest study on buying and selling transactions on social media and their impact on consumers.

CfDS researcher Treviliana stated that until now, no government policy specifically regulates social commerce.

“The Indonesian government has implemented regulations regarding consumer-business relations through Law No. 8 of the Year on Consumer Protection, Ministerial Regulation No. 71 of 2019, and the Personal Data Protection Bill as an existing legal framework to prevent data misuse practices. However, these regulations still need to clarify their technical framework.” Trevi said.

In addition to privacy risks such as data leakage, there are several other risks that consumers can potentially experience when transacting in social commerce. For example, the risks of product quality and quantity, illegal products, or even expired products. Not only that, financial risks such as loss of money and economic losses are also very likely to occur.

According to the Indonesian Consumers Foundation (YLKI), most cases related to digital transactions are in the form of undelivered goods, compensation, goods received that are not as advertised/described, and account violations.

Therefore, as the YLKI Complaints and Legal Coordinator, Sularsi hopes the government has clear regulations regarding data assurance and data management in social commerce. Likewise, the problem-solving system experienced by consumers should also be simplified.

In his presentation, Sularsi also said that to overcome the risks, consumers need to have literacy related to interactions in social commerce. Consumers are advised to seek clear information and verify the seller’s credibility.

“No matter how good the regulations are, if the people are not well-literate. So it will still be in vain,” said Sularsi.

Besides being attended by representatives from YLKI, the event was also attended by Agung Bayu Purwoko as Expert Economist of the Payment System Policy Department of Bank Indonesia, and Noudhy Valdryno as Public Policy Manager for Indonesia & Timor Leste Meta.

This activity was organized with the support of the Consumer Protection in ASEAN (PROTECT) project, which was created by Deutsche Gesellschaft für Internationale Zusammenarbeit (GIZ) GmbH and funded by the German Federal Ministry for Economic Cooperation and Development (BMZ).