Over the last two years, mobile payments have started to become advertised as a must have feature when a new high end smartphone comes out; it happened with the iPhone 6 in 2014 and in 2015 with Samsung Galaxy S6 for Samsung. These new form of payments are aiming to replace your wallet and make it easier for the consumer. Considering, now a days, people are always on their phone, it does make sense to try and combine a user’s wallet into their phone. However, even with the advertised security claimed by Apple, they are not preventing stolen credit cards from being inputted in the phones [2]. To test this, I actually asked a friend to input their credit card information into my iPhone 6s to see how easy it was to add a card. Once all the info is inserted, it must be verified through either a text, a call, email, or through a call with the issuing creditor. If someone could hack into someone’s email then this would be very easy to add this stolen card to your apple wallet. There are also reports of people being able to find about people through searching them on google, thus being able to answer security questions that are typically asked over the phone. The article also talks about how they tried to reach out to major banks and ask them how they have implemented security measures to combat this issue; there was response - or lack of - was startling. Not one major bank was able to give specific details as to how they are dealing with this issue, citing “privacy concerns”. As a consumer, and iPhone user, I would want to know if appropriate measures are taken to ensure the security of my credit cards. This could have a huge impact on business as well because if there is no trust between the consumer and the banks, then people will be willing to spend less on products. As of Dec. 2105, one fifth of iPhone 6 owners in the US (20%) have used Apple Pay at least once [1]. It has been a slow adoption rate, however, criminals are quickly adapting to being able to use Apple pay; once that card has been loaded onto their phone, they can spend freely.
Some things I feel were overlooked in this article were how SamsungPay (a competitor) does against apple pay, how consumers can protect themselves if they cannot rely on apple pay or their banks, and also how frequent that this does in fact happen. In March 2015, it was found that 6% of all Apple Pay transactions were found to be fraudulent versus 0.10% of transactions on traditional plastics cards [3]. Also, in order to protect yourself, consumers should set up
automatic alerts on the card activity, in case there is fraudulent use [3].
[1] Boden, Rian. "Apple Pay Awareness, Adoption and Usage Drops in the US • NFC World+." NFC World+. N.p., 12 Feb. 2016. Web. 04 Apr. 2016.
[2] Brewster, Thomas. "Here's Proof Apple Pay Is Useful For Stealing People's Money." Forbes. Forbes Magazine, 1 Mar. 2016. Web. 03 Apr. 2016.
[3] Lowry, Erin. "Apple Pay: Was It Fraud? Or Wasn't It?" Apple Pay: Was It Fraud? Or Wasn’t It? MagnifyMoney, 06 Mar. 2015. Web. 04 Apr. 2016.
Apple is one of the most reputable technology companies in the world. so you would think they would know what they are doing, especially in terms this particular case. I personally don’t use Apple Pay, but I find it surprising that this payment system is not as secure as expected. I am also really surprised by the statistics, as mentioned, 6% of all Apple Pay transactions were found to be fraudulent? That is an extremely large percentage, especially compared to the 0.10% of transactions on traditional plastic cards. Also the fact that the banks do not know specific details as to how Apple is dealing with this issue is not a good sign. I have not heard much about this issue and feel like Apple should really make it clear that their system is not as reliable as transactions on traditional plastic cards. I am curious as to how Apple plans on fixing this issue. Looks like I will be sticking to the traditional method of credit card payment!
ReplyDeleteUnlike Apple Pay and one of the major flaws pointed out in this post, SamsungPay appears to be much more secure than Apple Pay just due to the fact that SamsungPay does not store the account or any of the credit card numbers on the device using SamsungPay. Samsung uses tokenization for transactions which means tokens which are nonsensitive data is sent instead of directly sending the sensitive data. This concept from the get go gives SamsungPay the upper hand on Apple Pay as far as security goes.
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