Mobile wallets allow users to conveniently carry their money with them at all times, storing payment card information on a mobile phone or device. It is one of the easiest ways to make an in-store payment at locations listed with a mobile wallet service provider. Carrying a physical wallet around is not only bulkier and no longer necessary, but also a riskier option
Dangers of Using Other Payment Methods
Mobile wallets are more secure than swiping cards because the magnetic strip on a traditional card is easy to hack. Any magnetic scanner can read and steal this information, and thieves are able to tamper with card readers, often leading to compromised accounts.
Crooks can also hack into databases kept by retailers, which often contain transaction data that makes future payments easier. If a hacker loads a virus onto a retailer’s computer, transaction data (including sensitive card information) can fall into the wrong hands. Technological advancements have caused thieves to become even more inventive. Now, some wireless card readers can actually steal your data while your card is in your pocket or wallet!
How are Mobile Wallets Safer?
There are a number of advancements that make mobile wallets a safer and more effective option for twenty-first century shoppers.
Transaction Encryption
During a mobile wallet transaction, your bank details are not as vulnerable as with a magnetic card reader. Your phone encrypts the account information, which the Point of Sale (POS) reads through a technology called NFC (near field communication). This technology enables devices to communicate when brought within a small radius of each other. The reader sends the information to the mobile wallet service provider who then decrypts the transaction and confirms your identity. The payment processor accesses your bank details and requests payment from your bank, then transfers the funds to the retailer and confirms purchase.
Lost Phones Security
If your phone gets lost, you are assured of your wallet’s security. A smartphone can be passcode enabled, and additional features such as biometric security can be employed. Additionally, mobile wallets can be turned off remotely from another device to ensure that data is secure. This means if your phone gets lost, no one can access the mobile wallet app. Compared to losing a physical wallet, a mobile wallet has much fewer consequences. Rather than losing all cash and having to cancel credit cards, the wallet itself can be disabled, with all bank information still safe.
Summary
A mobile wallet makes your money transactions easier and more efficient. Carrying a physical wallet and cards around is risky, with cards being more susceptible to hacking and theft. A mobile wallet’s encryption makes hacking more difficult. Even if you lose your phone, the contents of a mobile wallet are still secure. Studies show that awareness of mobile wallets is rising considerably across different sets of demographics.