A New Look at Mobile Payments Security

April 5, 2018         By: Steven Anderson

When mobile payments first emerged, a lot of people looked at it the way people used to look at online shopping. It was crazy, people figured, to use a mobile device for payments. It was even crazier to do so with a mobile device connected to a bank account. It was practically an open invitation to have hackers plunder your life savings! Naturally, that’s changed since, but there are still some concerns, and a new report is looking closely at the security issues currently surrounding the concept.

Mobile payments, as a whole, hasn’t really caught on. Though awareness is doing fairly well—even in 2015, 52 percent of North Americans had heard of mobile payments—use is well below. Just 18 percent used the option regularly.

Security is still a big problem keeping people out of the field. Current users seem reasonably happy with PIN and card taps—the Europay / Mastercard / Visa (EMV) switch likely cemented this—and this leaves the somewhat shakier phone system out of play. Nothing succeeds like success, after all, and most people find that cash is safe, and cards usually are too.

Worse, the stories of data breach aren’t helping; while in 2016, just 23 percent of merchants believed fraud was on the rise, by 2017 that number nearly doubled to 40 percent. Most even only maintain a certain level of security for users, despite a clear believe—60 percent—that browser-based mobile payments have some of the highest risk.

There are measures to take, of course, to protect yourself. Doing your research, improving your password strength, using a “find my phone” app to help keep track of that device and educating those around you about how to make mobile payments safer. Yet even these only go so far; personal responsibility is a great thing, but it kind of pales when a story of a Saks, Home Depot, or even Dairy Queen breach emerges. The strongest password around doesn’t do much when the store itself is hacked.

While fixing security concerns will be a big part of the fight, it won’t be the only one. With shoppers not seeing much reason to switch and being actively concerned about the product itself, there’s a long way to go before mobile payments are fully mainstreamed.