Easy to Use, Mobile Payment Apps Are Also Easy to Misuse

 

Easy to Use, Mobile Payment Apps Are Also Easy to Misuse

While they have taken steps to help prevent mishaps, a new report finds they offer few protections if, for instance, users accidentally send money to the wrong person.

By Ann Carrns, writing for The New York Times

 "Services like Venmo and Zelle let people pay others or receive payments almost instantly, with a few taps on their phone. To use them, you typically download the app and link it to a bank account or credit card" 

"But while they’re fast and easy, the apps can have serious drawbacks. Users can lose money if they accidentally pay the wrong person, mis-type a dollar amount or succumb to a fraud or a scam that tricked them into making a payment." 

Consumer Reports "determined that none of the four popular payment apps — Apple Cash, Cash App, Venmo and Zelle — reimburse users when a payment is mistakenly sent to the wrong person, because such transactions are considered 'authorized.'"

"Apps also wouldn’t compensate clients if a criminal tricked them into sending money."

Advice:

“Slow down when using the apps,” said Rachel Gittleman, financial services outreach manager for the Consumer Federation of America.It's easy to mis-type.

Before hitting send, "confirm the recipient’s user name, phone number or email address." “Double, triple and quadruple check” that you are sending the money to the right person.

It’s also wise to send a small “test” payment — say, $1 — and confirm the correct person received it before sending a large sum.

Mobile payments: When a wallet is no better than a ziploc

"Many startups aren’t properly securing their users’ data," according to Ilga Kharif writing for Bloomberg Business Week. Are you a PayPal, Dwolla, or Venmo user? Then you need to read this article.  If you are using your smart phone to make payments (with any of a variety of apps) you are setting yourself up for identity theft. As more people around the world use mobile payment apps the hackers and thieves are having a hay day taking advantage of the security gaps to steal money and identities from users. 
"Mobile app security provider Bluebox found vulnerabilities in all the roughly 10 unnamed U.S. mobile payment apps it examined last year. 'Most of the time, the apps themselves aren’t using any kind of encryption to protect the data on the phone or to protect the data in transit,' says Andrew Blaich, Bluebox’s lead security analyst."
Think twice before you pay with your smart phone. The few seconds it takes to pay with cash, check, debit or credit card can save months of agonizing frustration if you become a victim of ID theft.  Read the details at: http://www.bloomberg.com/news/articles/2016-03-10/many-mobile-payments-startups-aren-t-properly-securing-user-data