The number of people signing up with mobile money transfer apps have boosted over the past 2 years. After all, the admirable qualities make them an accessible, convenient, and cost-efficient way to send and receive funds online.
However, there is a need to closely assess the risks associated with the use of such apps.
This has become necessary after analyzing how consumers are growing more resistant to sharing financial information online. Majority of them now want government regulators to do more to mitigate the losses and hacking events that take place every year.
The Simplistic Designs For Most Money Transfer Apps May Have Resulted In Certain Technical Issues
Designers have done an outstanding job in making money transfer platforms easy-to-learn but what have they compromised on?
Most critics are of the view that the simplicity has resulted from overlapping and uncoordinated legal and technical agreements. They argue that certain financial regulations had to be ignored to keep digital payment apps “minimalistic”. As a result, they run the risk of being highly prone to errors and financial frauds.
As an example, let us look into sending money from one online account such as Netspend to another peer-to-peer money transfer app, Cash App. Undoubtedly, this kind of money transfer is swift but in most cases, there is nothing you can do to revert the money if you happen to send it to the wrong recipient.
Moreover, there is no law supporting funds reimbursement if the sender loses money due to faulty transactions. This is known as outright fraud and it is just another major issue that digital payment apps are facing.
Even When It Comes to Privacy, There Is So Much Room For Improvement
This would also imply that the applications can leak your sensitive data to third-parties for marketing purposes.
There are only a handful of names in the world of digital marketing that have, instead, implemented strict regulation of the data that they collect from the users to make mobile payment safe and secure.
Only Specific Companies Have Introduced Extra Layer of Security For The Consumers
Surveys carried out in 2019 highlighted how companies are only investing lightly on setting up extra layers of security for the users when, in fact, they can do so much more to improve the privacy and protection of sensitive data.
Most of the applications do not even require consumers to re-enter or provide a specific PIN for transactions after they have logged in.
Again, the repetition of the security measure may have been eliminated to simplify the transfer process. Nonetheless,
Apple is one of the few leading institutes that require users to confirm a payment before it is sent. Since the company has introduced Apple payment in many public places, it was found necessary to take extra steps as precautions.
The Consumer Financial Protection Bureau has a lot of homework to do if they wish to extend better security protocols to the users of digital payments apps.
Compensation for the victims of frauds, money reimbursement, and reversal of a transaction are just some starters. However, introduction of these changes would be extremely beneficial to the consumers and may encourage more transparent use in the future.