Are P2P Mobile Payments Too Fast for Users’ Own Good?

January 24, 2019         By: Steven Anderson

Ever since Venmo got started up, peer-to-peer (P2P) mobile payments have really taken off. It’s come a long way from a mere afterthought, if that, to a major part of the market as exemplified by the Zelle network and the fact that even Apple Pay is adding P2P options. A new report from PaymentSource, however, suggests that one of P2P’s greatest advantages—its sheer speed—may actually do more harm than good.

P2P is catching on, regardless of any potential risks. Word from the National Automated Clearing House Association says that, just in the second quarter of 2018, 29.4 million P2P transactions went through. That’s 24 percent more than the same time the previous year, and it doesn’t show much sign of slowing down as we go into 2019. One of the biggest reasons people turn to P2P payments is for their speed and convenience, but with so many transactions going through and going through so quickly, this improves the chances they will be targeted by criminals.

The combination of rapidly-increased popularity, a lot of transactions going through at almost any given hour of the day or night, and a massive amount of personal information freely available online means that criminals will likely consider P2P an attractive target. With over 17.6 million consumers falling prey to identity fraud in just 2017, there’s a hefty amount of new information added—and used illicitly—in the meantime.

Granted, all this does add up to a potential problem. With so many transactions going through the system at any given time, attempts to illicitly gain access to users’ accounts will blend into the background traffic well. After all, can a system reasonably tell the difference between someone trying random passwords and someone who’s had a little too much to drink trying to remember their own password? The answer is likely not. This is why some enhanced security likely wouldn’t go amiss here, including things like biometric security systems, alternating passwords, and even more attempts to predict “bad actors” right at enrollment.

There are a lot of things we can do to improve mobile payment security, and many of these have been done. Criminals will always work to find ways around that improvement, though, which means further improvement must always be in the works.