Mobile wallet refers to the practice of using smartphones for payment through credit or debit cards. In essence, information is stored on your smartphone in digital form. Mobile wallets are fast replacing the physical credit cards as an increasing number of consumers are switching to mobile wallets due to the sheer convenience it offers to the in-store as well as online payments. Mobile wallets can be used to store and organize information related to credit or debit cards but also coupons, loyalty rewards etc. in one central place for easy and quick access, eliminating the need of carrying multiple cards and coupons.
Security concerns prevent widespread use of mobile wallets
Despite the convenience it offers, mobile wallets adoption rates are still not very high primarily because of security and privacy concerns related to their usage. Chief among this are concerns related to the financial data stored in the phone, in case the handset is misplaced. With credit card and identity theft at an all-time high, there are legitimate concerns that using smartphones as mobile wallet might make them very vulnerable to theft.
Most of these concerns, however, are unfounded as mobile wallets are in certain ways safer than current credit cards. Secure payments, in part, due to the way financial information is transmitted between the bank and the application, via a token in place of the customer’s account number. The token is actually an encryption that allows for only the application provider to understand the unique details of each transaction and carry out the transaction instructions. Transactions through a mobile wallet are highly secure with most organizations providing this service guaranteeing foolproof security for users of mobile wallet. In order to allay consumer concerns regarding use of mobile wallet adequate mobile wallet security measures have been put in place to ensure any transaction you undertake through mobile wallet is completely secure with no leakage of information whatsoever.
Mobile Wallet Security Measures
- Ensuring the full card number is not visible to retailers and merchants at the time of purchase.
- In case a customer’s mobile device is stolen or lost, mobile wallet services can be instantly disabled to prevent any data leakage
- Mobile banking allows the customer to view transaction history and get an alert every time there is activity on their mobile wallet
- Some service providers offer zero Liability protection which basically means that the bank or financial authority will not hold the customer responsible for reported unauthorized transactions.
- 24/7 Monitoring and Fraud protection services are offered by all mobile wallet service providers
Apart from the mobile wallet security measures put in place by organizations, there are a couple of measures that consumers can themselves take to ensure security and privacy of information stored in their mobile wallets.
- Do not download and install apps unless they are from trustworthy sites
- Do not entertain requests from apps that that seek access to information with potential for misuse
- Enable maximum security protection available on your smartphone and mobile wallet
- Enable password security and ensure that you change your password at regular intervals for added protection
Choose a mobile wallet service provider that is able to adequately address your concerns related to security and privacy and you should be all set to enjoy the convenience and ease that comes with using a mobile wallet.