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How to Safely Use Payment Apps

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Kimberly Palmer

As a frequent PayPal user, I was not surprised to see a payment request pop up in the app. However, when I read it, I realized something was wrong.

In the message, a stranger asked me to send $699 to get a “refund”. I knew immediately that the request was a scam, but I still felt vulnerable. I didn’t immediately see a clear way to flag the request as a scam, and I could have accidentally sent this stranger a lot of money with just one click.

I’m not the only one concerned about security when using peer-to-peer payment app: According to a Pew Research Center survey published in September 2022, about one-third of people who use payment apps or websites believe that “payment apps or sites protect people’s personal information from hackers or fraudulent attacks. We are confident, or not at all confident, that we are protecting against user. And a staggering 13% of those who have used PayPal, Venmo, Zelle or Cash App said they made the mistake of sending money to scammers.

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Fraud prevention experts recommend these strategies to keep your money safe.

Send money only to people you know

Peer-to-peer payment apps are generally designed to send money between friends, not strangers. Using them to send money to people you don’t know puts you at risk of fraud.

“Unless you have met in person and know who you are sending money to, you should not send money. It could be a popular way to send money.” The American Bankers Association, a banking industry trade group.

Use cash and credit cards in high-risk situations

If you need to exchange goods or services with a stranger, the safest method is cash or credit cardsays Axton Betz-Hamilton, assistant professor in the Department of Health and Consumer Sciences at South Dakota State University and author of The Less People Know About Us, a memoir on identity theft.

For example, credit cards come with anti-fraud features. “I don’t use these apps because I want that protection,” she says.

Stolen cash can be difficult to recover, but may be covered by the homeowner’s and renter’s insurance policy (up to policy limits, depending on policy).

Be careful with text messages, phone calls and unsolicited requests

Fraud is often perpetuated by scammers sending texts, phone calls, or other types of messages to encourage money transfers, possibly claiming that a refund is required or that the charge is late.

Joel Williquette, senior vice president of operational risk policy for the Independent Community Bankers of America, a community banking industry group, said: This includes sending emails that are almost indistinguishable from legitimate banking emails.

Cybercriminals can impersonate the IRS or FBI and demand that peer-to-peer payments be sent immediately to pay off debts, but legitimate agencies may contact them by text or call your cell phone. Williquette says he never asks for emergency money.

“Usually they send you a letter,” he says, and doesn’t ask for payment by app or gift card. This is also a red flag.

Fraudulent payment requests sent by peer-to-peer payment apps “usually are small amounts and can even appear to come from friends,” says Eva Velasquez, president and CEO of the nonprofit Identity Theft Resource Center. says Mr. .

Velasquez urges people to confirm their requests by double-checking that they’re sending money to the correct person first.

Upgrade your cyber hygiene

Enabling two-factor authentication on your financial accounts, adding a pin lock to your phone, and using unique passwords of 12 characters or more can help keep you safe, says Velasquez.

She also suggests setting the app’s privacy settings to the most private option to minimize the amount of information about you exposed.

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According to PayPal, if you receive a payment request like the one I received, you should cancel the request without paying.In addition, you can also take screenshots and transfer them phishing@paypal.comPayPal do not reply, open links, download attachments, or call the phone number included in the request.

If you accidentally disclose financial or personal data con man, PayPal says you should change your password immediately, alert your bank, and report any unauthorized payments to PayPal. You can also report fraud to the Federal Trade Commission. reportfraud.ftc.gova government website that shares information with law enforcement agencies.

In my case, I followed the recommended procedure of canceling the payment request and never heard from the scammer again. With enhanced security procedures in place, we plan to continue using the convenience of PayPal and other payment apps. Now you know what to do the next time you receive an unsolicited payment request.

This article was written by NerdWallet and originally published by The Associated Press.

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