Mobile apps have made money management a breeze in recent years. Take the CPS IBEW FCU mobile app, for instance. Right in the palm of your hand, it gives you the ability to check account balances, transactions and deposit history, transfer funds between your accounts, deposit checks, pay bills, find ATM locations, and even use secure messaging for support. Find out more here >>>
Peer-to-peer (P2P) payment services like PayPal, Venmo, Zelle, Square, Apple Pay and Google Pay are also convenient and used by more than 70% of Americans. These apps have been lifesavers during the pandemic, allowing users to transfer money while socially distanced. Americans used them to process mobile payments 500 million more times this past June than in June 2019.
But these P2P mobile payment apps put your money at risk in more ways than a banking app like ours does, a fact that hasn’t gone unnoticed by scammers. The New York Times reports that payment app fraud rates can be three to four times higher than for credit and debit cards. Accidental payments, phony withdrawal notices, and scammers posing as a “friend in need” top the list of fraud. Hacking and other means of gaining access to account information are also common.
To help protect your money:
Be sure before you send.
Many P2P services will not refund your money or reverse a payment if you make a mistake, like sending money to the wrong person (which can happen as easily as mistyping a phone number or misspelling a name). Even the FTC warns: Once the funds are transferred, the money is likely lost.
Take privacy and security seriously.
It’s essential to take extra steps to secure your P2P accounts and the funds they access. Creating strong, unique passwords for your P2P apps and disabling automatic logins are a start. When apps offer added security like multifactor authentication (emailed or texted security codes unique to that one transaction), sign up. A study from Microsoft shows multifactor authentication can defend against 99.9% of fraud attempts that use stolen login information.
Keep the apps and your devices updated.
Software updates for your P2P apps and your devices like your cell phone and computer are important. They often include patches for security vulnerabilities that are continually identified. It’s important to check for updates and not ignore notifications to ensure you have the latest and most secure version of your payment tools and device software.
Protect your funds.
Most P2P apps don’t protect your purchases like many banks and credit unions can when you use their credit cards and debit cards directly. That’s why most P2P apps like Venmo state that they are exclusively for payments between friends and people who know and trust each other. Payments for goods and services (like for event tickets or online marketplace items) are unnecessarily risky. For added protection, don’t connect your primary checking account or debit card. Using a secondary bank account funded just for online purchase or using a pre-paid card when possible may be the safest options.
If you feel your CPS IBEW FCU debit card or checking account has been compromised, log into our mobile app to freeze your debit card account and give us a call at 210-353-2376 to alert us. The sooner you catch the problem, the better. And if you’ve been a victim of a scam involving a P2P payment app specifically, file a complaint with the FTC to help stop others from being targeted.
Remember that convenience can be costly. While paying someone with just a click is fantastic, taking a few extra steps to secure your money from fraud and accidents is well worth the effort.
