Peer-to-Peer (P2P) payment platforms such as Zelle, Venmo, Apple Pay, Google Pay, Facebook Payments, and Cash App make it convenient to send someone money from your checking account. Unfortunately, scammers have also discovered this convenience. Many consumers don’t know that payment services have limited if any, fraud protection. Once the money is sent, it’s gone.
Beware of these potential scams
Even though scammers are actively working to take advantage of these platforms, if you use them carefully, money transfer apps are safe. A general rule of thumb to remember is that once you send money digitally, it’s nearly impossible to get it back.
Here are three popular scams to avoid:
- Don’t use money transfer apps in online marketplaces and trading sites. Once you send money, there’s nothing holding a vendor to their end of the bargain.
- Avoid ticket scams for concerts and sporting events. As with online trading sites, never use a money transfer app to pay for something before you receive it. Your wallet will thank you.
- Avoid malicious emails. Fraudulent emails and phone calls have been around for decades, but they have inevitably adapted to money transfer apps. Beware of opening any prize, sweepstakes, or IRS-related emails or text messages. Savvy scammers will load these emails and texts with malware that can download onto your digital devices and expose your financial information.
Tips for money transfer app safety
Now that we’ve explored the worst-case scenarios, let’s focus on the best ways to promote your safety.
- Secure your app: Americans carry less cash than ever before but don’t be fooled by this. If you have a money transfer app on your phone, you are essentially carrying cash (and far more than you could fit in your purse or wallet). If you lose your phone or have it stolen, you expose the entirety of your cash supply to a total stranger. Take precautionary measures by enabling maximum security for your money transfer apps. Investigate the privacy settings available to you like Face ID, fingerprint ID, or two-factor authentication, and ensure that only you can use the app.
- Only send money to people you know: This may seem obvious, but by only exchanging money with your closest acquaintances, you significantly reduce your chances of fraud. With money transfer apps, you are the first and last line of defense, and you’re only as safe as the precautionary measures you implement for yourself.
- Trust, but verify (and verify again): If you do have to send money outside your “circle of trust,” check the new recipient’s information multiple times before clicking “send.” Remember: once you transfer money through an app, you likely won’t see it again.
- For example, if you’re sending money to “Marie Smith” and search for her on the app, there will likely be multiple accounts under the same name. In addition to carefully identifying the correct user account, be sure to enter the exact dollar amount you want to send. One misplaced zero could be costly.
- Adjust your privacy settings: Some apps feature a social aspect to money transfers. With Venmo, for example, each transaction is listed on a digital timeline with emojis or a few words to describe the nature of the exchange. While this may seem like a fun way to engage with your network, it’s best to turn off these social media feeds and keep your finances entirely private.
- Don’t use public wi-fi for transfers: Nobody wants to burn their monthly data plan, but when it comes to money transfers, it’s best to use your own Wi-Fi or cellular data network. Public Wi-Fi is notoriously vulnerable to hackers and should be avoided whenever completing any financial transaction. If you absolutely must use open Wi-Fi, create a Virtual Private Network (VPN) before transferring any money.
Sending money using the South Bay Credit Union Mobile app
At South Bay Credit Union, your security is our top priority. With the SBCU Mobile app, you can safely send money when needed.
To protect your personal and financial information, our app features advanced encryption systems. Plus, whenever you complete a transaction, you’ll be able to track its progress right from the app.
Ready to get started? Download the mobile app for Android and iOS in the Apple App Store and Google Play Store.