From collecting gold stars for your latest latte run at Starbucks to paying for your new pair of kicks from Foot Locker, where you can use your mobile wallet is increasing every day. Now, more locations than ever before are accepting digital payments straight from your phone. As retailers sink considerable funds into outfitting their stores with compatible POS systems, the frequency you’ll use your mobile wallet will increase ten-fold.
Though it’s a quick and easy way to pay for items, it isn’t without its shortcomings. A mobile wallet is open to unique risks that cash and other forms payments are not. If you plan on growing your mobile wallet to include a variety of apps and financial services, you need to make sure you secure it in the following ways:
- Embrace multi-factor authentication
A password is the most basic security feature protecting your various financial accounts. Online security 101 tells you a robust password contains at least eight characters, of which there should be a good mix of numbers, special symbols, and upper- and lower-case letters. Experts say the best password is a nonsense combination of characters — so not your child’s birthday or your phone number.
But even passwords that meet these criteria aren’t the strongest when it comes to your mobile wallet. Every time you reuse the same password for different accounts, you’re weakening it through overexposure. You also undermine its security should you punch it in while using unsecured public Wi-Fi — doubly so if you sign in on a public device.
Multi-factor authentication can boost a basic password by requiring several steps to verify your identity. In order to confirm you are who you say you are, this method uses:
- Something you know: this would be your password, PIN, or special lock pattern
- Something you own: this would be the phone in your hand.
- Something you are: this would be biometric data collected from a fingerprint sensor or the iPhone X’s Face ID.
For example, after you sign into your account, this method would send a time-sensitive verification code to your phone number. You need your phone to receive this code. When you punch it in, you would then have to confirm it’s you with your fingerprint or face. It’s far more secure than a mere password. Even if a criminal managed to steal your password, they wouldn’t be able to use it unless they had your phone and your biometric data.
- Only trust credible sources
As the mobile wallet rises in popularity, the number of companies offering their services via apps will grow too. You have a responsibility to ensure these companies do their best to protect their customers from data theft. It doesn’t matter if you only use your mobile wallet as a way to charge your BoA checking account at The Gap, or if you plan on searching for payday loans online with your phone. Regardless of your intent in front of the screen, you need to make sure your choice of app provider is on your side.
It’s critical you ensure the apps you’ve download respects your personal information. Whether you’re applying for payday loan online or registering your bank account, you’ll be transmitting confidential data, like your social security number, address, and financial account numbers. The companies you choose to make up your mobile wallet should follow federal privacy laws to keep your information safe. A company like MoneyKey, for example, relies on bank-level Secure Socket Layer (SSL) encryption to protect your personal information on its app.
In addition to confirming they have a robust security framework in place, you can further protect yourself by downloading these apps from the official App or Play Stores. Downloading apps from any other source puts your data at risk.
Some economist believe a cash-free economy is in our near future. Scandinavian countries like Sweden, Norway, and Denmark are leading the pack. Though the US may be far behind, even American markets are embracing digital payments. If you expect to participate in them safely, you’ll need to protect your mobile wallet with the appropriate security measures.