2018.10.18

Financial Security in Focus: How Mobile Wallets Ensure Consumer Safety

Smartphones have become our go-to devices for almost everything. Whether we want to communicate, take a photo, read the news, or check some information online - the solution is right there, in our pocket. These devices have taken the world by the storm: the number of smartphone users is estimated to grow to around 2.5 billion by 2019, which makes around the third of the entire planet population.

 

Smartphones are also becoming a substitute for our physical wallets, which shouldn’t surprise us given the fact they are incredibly convenient and align with our modern way of life. But just like with any type of disruptive technology, people are a bit sceptical about mobile wallets, especially due to safety concerns.

 

Hacker attacks are becoming more sophisticated and so security vulnerabilities and data breaches remain consumers’ main fears. This is why the mobile wallet adoption isn’t happening at a rapid rate, but rather steadily.

 

However, it all comes down to the lack of real insights about how mobile wallets work.

 

How Mobile Wallets Work

Simply put, mobile wallets are the digital equivalents to the traditional wallets we use. As such, they store digitized valuables that are used for authorization. Therefore, consumers can easily access products and services. Depending on the specific case, these digitized valuables can come in the form of a sequence of numbers, a QR code, or any other type of unique identificator.

 

Undoubtedly, the core benefit of mobile wallets is convenience. Your mobile device stores a payment information from a card you’ve linked to it, enabling you to make purchases with one touch on the compatible reader, i.e. digital payment-enabled terminal. Mobile wallets rely on the near-field communication (NFC) chip, which is the same technology used for contactless payments with an actual physical card. Transactions via mobile wallets are typically faster.

 

The financial security part of the story is rather intriguing. You will be surprised to find out mobile wallets actually may be the safest way to make a payment thanks to their advanced technology.

 

Encrypted Technology Ensures Maximum Security

Encrypted technology is well spread today and we use it on daily basis without even realizing it. Computing devices (e.g. smartphones, desktop computers, tablets) rely on encrypted information to keep sensitive data protected and secure. Even instant message services use it to keep user conversations safe and private.

 

Encryption randomizes normal characters and numbers, and turns them into ciphertext using a special algorithm. The end result? This text is unreadable both by humans and computers without a proper key called a chiper.

 

Due to this highly arbitrary nature, it is practically impossible to crack the encryption. Most mobile wallets are based on the 128-bit data encryption technology, which reduces the security vulnerabilities to a minimum.

 

Passwords Provide an Additional Layer of Security

Smartphones themselves offer a solid level of security for users. Newest models have advanced authentication systems, such as biometric protocols - face or eyeball scans, or fingerprint techniques for unique user identification.

 

Given the fact we all use smart devices for various purposes that involve sensitive information as well (e.g. medical databases, bank account information, etc.), it’s a good idea to take advantage of this additional layer of security.

 

Mobile wallets come with their own password system that’s based on a similar principle. You can choose your own complex alphanumeric password or turn to some of the mentioned advanced user identification methods. For your peace of mind, you can even combine the two, to ensure your data and money are both protected from intruders and any other third parties.

 

Mobile Wallet Acts as a Proxy, Enabling Safe Payments

Credit cards make all available funds instantly available and accessible to users, which can lead to security vulnerabilities. On the other hand, with mobile wallets - users can access only those funds that they’ve previously made available within it.

 

So, when a certain transaction is made, wider user’s banking data stays intact, making it impossible for any third parties to intersect it or misuse it.

 

In addition, via mobile wallets, users are able to completely track their transactions, which is not the case with cash payments. There is no need to go through the troubles of accessing the bank account records as everything is easily seen on the screen of your smartphone. This makes it easier to control your finances and see where you spend the most. You can make instant payments and they will immediately appear within your mobile wallet balance, while with the classical cards - you have to wait for a few days before the consolidation.

 

It’s Not the Technology That’s Risky, it’s Consumer Behavior

It is crucial to understand the mobile wallet technology itself is indeed safe and secure, but irresponsible behavior and improper usage of it can lead to undesired outcomes.

 

Most of consumers probably fear what could happen if their smartphone gets stolen, but the fact is - the same could happen to your credit card. As a matter of fact, sophisticated, high-tech devices are being used to steal information from your credit card, even without any physical contact. Card skimming is also a real problem, especially because it’s very hard to detect.

 

To ensure that both your phone and your mobile wallet stay protected, take necessary safety measures:

 

  • Keep a passcode or a fingerprint lock on your phone
  • Add another layer of security with mobile wallet security password or biometric identification
  • Avoid giving apps permission to access your personal info and social media accounts
  • Don’t click on suspicious links
  • Update your phone’s OS on a regular basis and run security checks to ensure it’s free from malware

 

In Asia, things are slowly heating up in the mobile wallet market. Experts say that mobile payments will hit $30 billion by 2021, and it’s not that hard to understand why. As long as you’re careful, you can enjoy great benefits that come with owning a mobile wallet, such as rewards and discounts within various loyalty programs. Let’s not forget that lightweight feeling that comes with making payments with just one touch.

 

Everything you need is centralized to one single point - your smartphone.

 

The convenience sounds too good to pass on, doesn’t it? We invite you to check out UniCard app and our card program, so you too can take advantage of the new, mobile wallet technology. Join thousands of successful businesses and individuals, make your life easier with UniCard!  

 

 




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