Consumers can keep their physical wallets in their pockets and purses. The age of mobile payments is here and we can now pay with smart phones. Enterprises TV reviews the pluses and minuses of making mobile payments.
Mobile payments are being accepted by a variety of merchants across the country. Some mobile apps utilize the GPS function in the phone to note the location of the user, and in stores. At that point, the user tells the cashier their name, their picture appears on the cashier screen and the money for the purchase is deducted from the user’s bank account. Other apps use email to let users exchange cash. Visa and MasterCard are also getting into the mobile payment business by using what they call Host Card Emulation (HCE) technology. This allows an Android phone user to tap their phone to a merchant’s card reader and the transaction amount is deducted from the user’s bank account. All of these are very convenient and no one has to have cash on hand or needs to pull out a credit or debit card. The Enterprises TV show wonders how safe these new ways of paying for items are.
Recently, there have been a lot of major hacks to brand name merchants’ card systems. Kaspersky Labs reported that 99 percent of newly discovered malicious software targeted the Android platform, in 2012. This leaves Android phone users wondering how safe it is to use a smart phone to make a purchase versus a credit or debit card. iOS users also saw problems this year when it learned that Starbucks’s was not encrypting the data and therefore made it available to hackers.
For most mobile payment users, the question of secure payments is not that big of an issue. However, a larger question remains: how does the merchant you are patronizing secure its data from attacks? Mobile payments are only as safe as the merchant’s data system. If you trust the merchant, go with a mobile payment. If not, use a credit card.