More than half of people who don't shop online have a lack of trust in the internet or are worried about keeping their data safe.
The Office of Fair Trading (OFT) released a report stating a third of internet users don't shop online and the cited lack of trust as their biggest reason. Of the non-online shoppers 30 per cent identified a lack of trust.
Personal security was the problem for 20 per cent, while 15 per cent simply had no faith in online retailers.
However the OFT believes that consumer confidence is improving. More than half (54 per cent) of respondents said shopping online was as safe as shopping in a store. This is a figure up from 26 per cent in 2006. But they also said online shopping could never reach its full potential with current attitudes.
Almost three quarters of the people that did shop online (72 per cent) still had concerns and many users were unaware of their consumer rights.
"Online retailing is the future for many businesses and increasingly important to the economy," said OFT chief executive John Fingleton in a statement.
"If consumers are not confident online, demand will grow at a slower rate. So we must tackle these concerns right now if the online market is to grow at its full potential," he added.
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