Mobile payment security explored

Mobile payments are the modern form of payment with an increasing number of people using their phones for payment of bills, purchases and money transfers. But the question remains: how secure is a mobile payment in this age of data breaches and devastating malware?

Where did it all begin?

Back in the late 80s, an American cryptographer started toying with the idea of a cryptocurrency that did not require any form of hard medium. In 1994, the first ever online sale was made, for a pepperoni pizza, and a few years later, PayPal emerged as an online payment option and mobile phone users were able to use their phones to buy cinema tickets. Google Wallet, the world’s first ever mobile payment system, was introduced in 2011, followed a short time later by Apple Pay and Samsung Pay. While it was slow to start with, mobile payments soon gained traction, and in today’s world, a large majority of people use mobile payments at some point.

Is mobile payment technology secure?

While it would be good to be able to give a definite yes here, it is difficult to say for definite whether mobile payments will always be secure. The security of a mobile payment depends on a number of factors, including mobile phone models and hardware changes. The make and model of a mobile phone can affect the way transactions are completed and can have an impact on security. The recent introduction of Tokenization has made payments more secure in many cases, protecting card information by substituting the card data with a string of random numbers and letters. The token is the part that is sent to the payment processor and is decrypted there to make the payment.

Since the card details are not kept on the mobile phone or the retailer’s system, this reduces the risk of card fraud and other security risks at point-of-sale. And even if the token is obtained by a fraudster, they are not able to decrypt and use it as it can only be decrypted by the payment processor’s system. Add to that the fact that many new smartphones have added layers of security, such as biometric scans, remote locking, remote wiping and device encryption, if your phone does get lost or stolen, it is easy to wipe the data or crash the phone to stop anyone accessing any information.

Many factors affect your payment security

Another factor that has an effect on the security of your mobile payments is the app that is being used for finalizing the transaction. While Apple and Google apps are as secure as they can possibly be, using a third-party app downloaded from anywhere, including the Play Store and iTunes, adds more risk and uncertainty in the security of the transaction.

Human error can also play a big part in the security of the transactions. Although it is rare, a disgruntled employee or uninformed family member can aid with security concerns, while public Wi-Fi can put your security at risk using unsecured connections, which can be more easily hacked.

How to maximize security on your mobile payments

Security locks

Firstly, make sure that your phone has the proper security locks to prevent unauthorized access. Whether it is a password or biometric fingerprint lock, it will ensure that, if your phone does get stolen, your data will remain intact. Changing passwords regularly, and using random numbers and letters with special characters will make it harder than ever to crack your codes.

Use Wi-Fi wisely

When using public Wi-Fi to make purchases with your mobile phone, you should make sure you are protected through the use of SSL and VPN connections. These secure connections prevent outside users from seeing data you share over an unsecured Wi-Fi network.

Third-party apps

As mentioned before, avoid using third-party apps for your mobile wallets. These generic versions can sometimes come with built-in malware that can steal your data as soon as you first connect it to the internet, and allow hackers access to your mobile payment wallet. Always use the recommended app of the mobile wallet to maximize security.

Mobile websites versus apps

Another thing to think about when buying from a mobile website is whether the store you want to buy from has an app. If they do, and you expect to purchase there regularly, it pays to use their dedicated app, as they are normally more secure than mobile websites. And if the app wants to save your card data, make sure it is designed by a credible company with a mind for security. Checking history and reviews is a good way to do your own “background” checks.

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