Mobile Money Security
With the increased prevalence of mobile money, new issues have begun to arise – one of the biggest, how safe these methods of payment really are. You no longer need to use cash or even a physical credit card to make payments, but is that actually making the entire process easier or more complicated and less secure? It’s difficult to say. In some instances many providers of these payment methods have begun working to enhance security and therefore increase the number of people who are actually utilizing mobile money.
What is Mobile Money?
First let’s take a quick look at what mobile money is. This is a method of payment that does not require you to actually carry around anything but your mobile phone or smart device. You are able to pay for things with a stored card number or amount of money through a transaction that you initiate from your mobile device. You don’t need to give a cashier cash or hand over your credit card. You simply scan your phone or tablet or transfer the money remotely from those devices. This is cutting down on the amount of belongings that you need to carry with you everywhere.
Holding on to Your Money
One benefit to this type of payment is that you no longer need to carry cash. Cash is easy to steal and, once stolen, difficult to recover or prove stolen. The average cashier can’t very well look at the stolen cash and know that it is stolen and even if they could (somehow) there’s no way to know from whom it was stolen. As a result, it becomes increasingly more dangerous to carry around cash for anything. In a similar way however, it has become dangerous to carry around credit cards or cheques for fear of theft.
Though a credit card is more difficult to use by someone who has illegally acquired it, it is not impossible. Some cards require a security code (PIN) to be used to process payments, but social engineering can be used to obtain the owner’s PIN, and some people carry a piece of paper with the PIN written on it; many stores do not even look at the credit card when a customer swipes it at a store, especially where the purchase is considered ‘low-ticket’ or low value. Credit cards also allow for purchase of items online which has no method of securing the card or proving that the actual cardholder is using it. This makes a credit card more dangerous to carry around, even though it is much easier to track the money being used and where it belongs.
The Mobile Money Landscape
With mobile money you generally need to have a mobile device that is capable of connecting to the Internet. This means you must have a smartphone or tablet rather than a more traditional cell phone. Once connected, you are able to store your credit cards or bank account information so that they can be accessed from the device. This means that no one ever sees or touches your actual credit or debit card and instead is given some coded information that the device can decode in order to process the payment. The device enables this transfer to occur but you don’t ever have to hand anything over.
The ability to pay for something without physically handing over your cash or credit card makes this method relatively more secure – think services like Tap and Pay. By handing someone cash or a credit card you are no longer in control as to what they are going to do with it. You run a risk of having information copied or stolen from you. With mobile devices there is minimal risk of this and you are able to retain possession of your device whilst simultaneously paying for the items that you want to purchase.
Security and Protection
Accessing information such as bank account numbers from your mobile device has been common practice for quite a while now as banks progressed into the world of mobile banking. This has become more secure, but primarily this occurs as a result of enhanced security on the side of the bank. Banks continue to increase their levels of security as they also continue to be targeted by hackers. It has become crucial for these system providers to increase security levels and in some cases a host of banks have locked down their apps so that a user must first visit the physical location to authenticate themselves before even being allowed to use the app.
Applications that use mobile money have also increased their security systems and protocols. For example, Apple Pay requires the user to touch their finger to the screen in order to send the payment. This means that you must have the correct fingerprint code in order to access the payment system at all. An incorrect fingerprint code will cause the system to reject payment. With Google Wallet you are required to input a preset 4 digit security code (PIN) each time you want to use the application. Without the PIN you are unable to access any of the features.
With these types of devices you also have the ability to remotely shut down the service. If your iPhone or Android phone is lost or stolen you can access the mobile wallet feature remotely and disconnect it. This means, even if the other person is capable of accessing the features and somehow able to bypass the other security features, the app itself will not work and be completely disabled. This is just another way of improving your security and the level of safety that you can expect using a mobile device payment method.
Mobile wallets and mobile money are becoming increasingly popular. Google Wallet and Apple Pay are two of the most popular and are becoming accepted in more and more physical stores and online retailers. Many are beginning to adopt these methods of payment as faster, less expensive alternatives to accepting credit cards and other physical methods of payment. It’s difficult to say how long it will take for these methods to prevail and be accepted by all retailers and establishments as well as all banking institutions, but for now it’s safe to say that it won’t be long. More and more institutions are accepting these mobile payments every day.