Even if you don’t have one, the mobile wallet is all around you. People are using Apple Pay to pick up their lattes at Starbucks. They’re using Google Pay when they’re grocery shopping at Whole Foods. They’re sending cash to friends over Venmo. It’s only a matter of time before you join in by using a payment app on your phone instead of the cash in your old-fashioned wallet. Before you take the plunge, here are four quick tips about the mobile wallet.
It’s safe
Experian reports digital payments grew to approximately $721 billion last year in the U.S, but more than half of American shoppers are still using credit cards because they fear the mobile wallet isn’t safe. It’s understandable in a news cycle punctuated by reports of cybercrime and data scandals like Cambridge Analytica.
In reality, digital wallets like Apple Pay and Google Pay are far better secured than a website like Facebook, as it uses data encryption, tokenization, and multi-factor authentication to protect financial information. In fact, mobile banking is more secure than online banking, something that more than 60 percent of Americans use.
There’s no reason to feel like a hack is imminent as long as you use your mobile wallet carefully. Some steps you can take to protect your data include:
- Keeping Mum: Don’t share your login credentials to anyone, whether in person, over the phone, or in an email or text. You should protect your username and password like you would any other financial data.
- Opt-in to all security measures: A password isn’t enough. Your mobile wallet needs multi-factor authentication to protect you properly. This includes a time-sensitive code and biometric data (like a fingerprint or face scan) confirmation before you can use your app.
- Don’t use public Wi-Fi: Starbucks offers free Wi-Fi to all of its customers, but don’t sign onto it to enable Google Pay. Unsecured public Wi-Fi is a security risk because it’s easy to hack, and someone could track your device and the logins you use.
It’s not just a payment method
The mobile wallet is still a relatively new service. As it ages and gets more popular, its financial reach will evolve, too. It’s already starting to branch out from its digital payment roots. While apps like Apple Pay and Google Pay take the lion’s share of users, FinTech companies are offering other financial services through their apps.
A company like MoneyKey has an app for people interested in borrowing cash. As an online lender of short-term loans, they were primed and ready to make the leap to an app platform. Their app is a convenient place for borrowers to apply for simple online loans. In removing many of the physical and time barriers that can delay a personal loan, online lending apps give borrowers a way to check in on their online cash advance loans 24/7.
For people looking to start investing, there’s a company like Robinhood offering a simple alternative to traditional investment opportunities. While conventional mutual funds and portfolios require some understanding of the market and a lot of capital, Robinhood relies on automated processes to generate smaller portfolios for those who don’t have the time or interest in doing the research on their own.
Though you may not have a mobile wallet just yet, it’s likely you’ll start developing one in the near future. It’s important you understand security before you take advantage of new mobile wallet opportunities like online lending and investment apps. The best advice for a beginner is to start small. Begin by checking out the top digital payment apps and then branch out whenever you feel ready for the next step.
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