bankingciooutlook

Risks of Using Mobile Payment Apps

By: James Robertson, Banking CIO Outlook | Friday, January 08, 2021

The COVID-19 pandemic has also caused changes in the way people shop, with e-commerce seeing a rise in demand due either to governments restricting contact between people to curb the spread of the disease or by people isolating themselves and doing most of their shopping online.

Fremont, CA:Though cash transactions are not going anywhere fast, the convenience of electronic payment solutions has been gradually rising in popularity over the years. According to a new report by the US Federal Reserve, cash payments accounted for just 26 percent of all payments. In the meantime, 65 percent of all payments were used for credit and debit cards and electronic payment systems.

The COVID-19 pandemic has also caused changes in how people shop, with e-commerce seeing a rise in demand due either to governments restricting contact between people to curb the spread of the disease or by people isolating themselves and doing most of their shopping online.

Risks

When it comes to mobile payment apps, one of the biggest risks is the loss of smartphone, which contains most of people’s personal details and payment data when one uses payment apps. If a person has not protected it properly, criminals can either rack up charges on the person’s cards or use their payment apps to go shopping. Aside from ending in either an empty bank account or overcharging one’s balance, the incident could affect your credit rating with the bank, which may make it harder for one to take out a loan or mortgage in the future.

Scam

Beyond directly attempting to hack smartphone or attempt to infect it with malware, cyber criminals often focus on other more conventional ways to make a dent in people’s wallets – cyber-scams.

The premise is usually similar to other fraud attempts, such as impersonating someone one may know and asking a person to help out during an emergency. The fraudster might also gain access to a person’s contact list and pretend to be someone they have already sent money to using a mobile payment app.

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