Advances in technology have made every aspect of our lives easier. This has become more obvious with people staying home during the pandemic.
Many of us have been able to work from home during these troubling times and one tool that’s made that happen is video conferencing apps like Zoom and Google Meet. Tap or click here to find out which video conferencing service is right for you.
Another way tech helps out is by making sending payments to family and friends much easier. Peer-to-peer (P2P) apps like Venmo and CashApp are more popular than ever. But there are some risks when using services like this. Keep reading and we’ll show you how to use them safely.
The risks with P2P apps
So what are P2P apps? The concept is pretty basic, honestly. It’s a way to send money to a friend through a mobile device. P2P apps let you transfer money from your bank account or credit card to another person’s account.
Some banking apps also make use of geolocation payments — which is also considered a P2P system. When two people are near one another, their mobile devices can connect through Bluetooth to transfer funds.
Apps and services like PayPal, CashApp, Venmo, Google Pay or Apple Pay are the most popular P2P payment systems. These payment methods are perfectly safe under normal circumstances, but there are some risks that you should be aware of.
Since it functions as a direct deposit, there is limited interaction with an actual bank. Once payment has been authorized it cannot be undone, and you would have little recourse if something is amiss.
Payment and fraud protection
That’s why you should always try to use a payment method that has some form of fraud protection included. If something does go wrong, at least you will have someone to help you figure it out.
According to Consumer Reports, most scams on P2P systems happen when people are transacting with strangers. Scammers can string you along, promising services or products, but once you have paid, they can disappear with your money.
Safely using P2P services
Here are some tips on how to stay safe when using peer-to-peer payment apps:
- Know who you are paying
Scammers know that P2P payments can’t be reversed, tracked or disputed through a bank. They will use this to their advantage. Only make P2P payments to people who you trust.
- Don’t do business through P2P
You’d be well-advised not to use P2P systems for business transactions. In fact, purchasing goods and services goes against many P2P app’s terms of service.
- Opt-in for added security
Check to see if better security options are available with your P2P service of choice. Some services will offer added protection for a small fee, and it could come in handy someday.
- Keep your app updated
Like all apps, keeping P2P apps updated is critical. If vulnerabilities are found in an app that hackers can exploit, the company will send an update to patch the flaw.
When used correctly, peer-to-peer payment systems are safe to use. The most important takeaway is to know who you are transacting with and take as much precaution as possible.