Like many of us, much of my life is managed on my smartphone. I use it for a little bit of everything, including most of my financial transactions. It’s how I buy my morning coffee, deposit checks and pay my rent at the end of every month.
A recent report from the Federal Reserve found that nearly 30 percent smartphone owners used mobile banking in the past year—and we’re not just checking balances. Over half use mobile banking for major transactions like paying utility bills and buying groceries. Nearly 40 percent use it to pay their rent or mortgage.
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Mobile banking can be incredibly convenient. But with every scan and tap of a “pay now” button, I can’t help but wonder: Is my money safe?
Despite the popularity of mobile banking and payments, almost 70 percent of people have worries about its security… and for good reason! Increasingly, our financial lives are saved on a single device that can be lost and found or stolen at any time. Add that to the rising threat of malware designed to capture your sensitive financial information and it’s enough to keep you up at night.
Luckily there are ways secure your device if you want to continue paying for your coffee with just a simple scan.
1. Secure Your Mobile Device
Plenty of mobile banking fraud happens when a phone is lost or stolen. In the event your device is out of your possession, leaving it completely unlocked exposes your accounts to thieves and scammers. So reconsider proving you trust your significant other by leaving your phone unlocked and use a password. As with anything else, create a strong password that consists of a unique combination of numbers and/or letters (not 1234 or the last four digits of your Social Security number). Also, make sure to set a “time-out” for your phone, so that if left unattended, it’ll automatically lock after a set period of time.
2. Remotely Disable Your Lost or Stolen Phone
If your device is lost or stolen, there are other ways to ensure your banking information doesn’t fall into the wrong hands. Most cell providers will allow you to remotely disable your phone until you find it, or to erase its contents altogether if it’s stolen. (Click here for a brief tutorial on how to perform these functions on iPhones, Androids, BlackBerrys and Windows phones.) Also, if your phone is lost or stolen, be sure to quickly notify your financial institutions—just as you would with a missing credit or debit card. Doing so will help prevent or resolve any problems that might arise with reversing unauthorized transactions.
3. Be on Guard
Finally, when it comes to preventing mobile banking fraud, the best defense is a good offense. Malicious software and apps are a common source of mobile banking fraud. Once downloaded, the “malware” hides in your phone and waits for you to log into your banking app or type sensitive financial information—all to be used in ID theft.
Before downloading any application onto your phone, research it thoroughly. Don’t necessarily trust an app just because it looks legit. It could, in fact, be designed that way to lure you in and collect your information. To be extra safe, only download apps from the official website of your bank or the company with which you’re doing business if you can.
One last tip: also watch out for unsolicited communications from your financial institution. Often, these are “phishing” messages designed to redirect you to a scam site once you click on the links provided. Don’t fall for it. Always visit your bank’s site by first entering it into the address bar of your mobile web browser.
Donovan X. Ramsey is not a personal finance expert. He’s a multimedia journalist who writes about all things social, political, cultural and whimsical. After college, Donovan set out to discover everything he didn’t know about the world of personal finance. Learn along with him weekly on EBONY.com as he explores more everyday money matters. Follow Donovan on Twitter @iDXR or at DonovanXRamsey.com.
