Since the onset of Covid-19 pandemic, mobile wallets or e-wallets have gained popularity, allowing users to transfer money digitally. Businesses and individuals, both are switching from cash to mobile money for contactless payments. Though Covid-19 is the most hated word these days, it has altered the mobile payment landscape and so is the need of having secured digital wallet solutions.
According to ‘Global Mobile Payment Methods 2020 and COVID-19's Impact’ report, mobile payment users are on the rise, and the pandemic projections estimate the number to be more than 1 billion in 2020.
How Secured are Mobile Wallets?
With the elevated usage of mobile wallets, you’re more prone to risk of your data being intercepted, and that’s where security plays a major role in digital wallet solutions. You may speculate, is your mobile wallet safe? Is it fraud-proof and secured enough to make all transactions digitally? The fact is digital wallets or mobile money services provide better security over your credit card or online payment methods. And how is that? The reason is when you make a payment through your e-wallet platform, the merchant doesn’t receive your bank or card details but a unique one-time code that’s required to process the payment. So, a fraudster wouldn’t find a way to steal your financial details. The justification of the security lies with tokenization that keeps your data heavily encrypted. So much so, if fraudsters try to hack, your credit card number and other details are not compromised.
Here are the key factors why digital wallets make for the most secured payment option -
Near Field Communication (NFC)
During a contactless payment with a mobile wallet, your phone carefully encrypts your account information, which is read by a PoS device through Near Field Communication (NFC). The NFC technology enables devices to establish a radio communication with each other within a specific distance. The PoS system does not capture the data, but sends it to the mobile wallet provider, who in turn de-encrypts the data, analyzes the account you are trying to access, and verifies your data. Once the mobile wallet provider verifies it and trusts the sender (or you), your card information is sent to third-party payment processor who accesses the required bank details and requests the bank to process and send the money to them. The payment processor then sends the requested money to the retailer’s bank and alerts the parties with push notifications that the transaction has been completed. The mobile wallet solutions provide complete security and encryption for both personal data and the actual payment transaction.
Tokenization is a method of digitizing a physical payment card into numerous digital payment means with the use of tokens. For instance, if a merchant system is conceded by a cyberattack, fraudsters will not be able to access your bank details, but tokenized data, which is of no use to cybercriminals as customer data is encrypted by a token, randomly generated. Mobile wallets are secured as they do not transmit your card details or Primary Account Number (PAN) which happens when you use a credit/debit card while paying. When you process a payment using mobile money system, the PoS terminal receives a token which protects the data while the transaction is processed. Hence, tokenization is a security key to your contactless mobile money system that helps in processing mobile payments over card payments and keeps your data away and safe from hackers and fraudsters.
This cryptogram ensures that the payments are initiated by a trusted card holder’s mobile device. If a fraudster tries to encrypt data during the transaction to hack bank details or card details, a unique cryptogram is sent with the token to that PoS device terminal which can not be applied on any other mobile devices.
Two-step verification, also known as two-factor authentication or 2FA adds as an additional layer of security for your digital wallet. When you login, it asks for a combination of password and code for authentication. This can be your selected form of a method such as the wallet password and one-time password or OTP generated and sent to your mobile number or a biometric mechanism like facial or fingerprint. This is the easiest and most secure way to protect your mobile money from any cyber threat.
Advanced and Secured Digital Financial Solutions
Advancements in digital payments are key factors that make the digital wallets or mobile money services interesting to both businesses and consumers, as digital financial solutions like MobiFin Elite provide the utmost security to protect against frauds and cybercrime. It offers Strong PSD2 Authentication, Device Authentication with OAUTH (Re) authentication and Multi-Factor Authentication, Secure Web Access with OWASP 2.0, and velocity checks. The solution uses ECC (Elliptic Curve Cryptography) approach which is a certified encryption method used by the US government and the National Security Agency.
How Secured is Your Mobile Wallet?
In the time of COVID-19, the use of contactless payment has increased drastically. And with this, comes the concern of using a secured digital wallet with end-to-end encryption functionality that ensures user’s bank or card details are protected. Did you ever care to learn how secure is your mobile wallet? Now that we have shared the technologies and factors that keep your virtual money safe in this article, you can opt for a secure and trusted mobile wallet solution that will certainly take your business to the next level.