How to Protect Your Data When Using Money Apps

logging in to smartphone

Privacy and security are a concern no matter what you’re doing on your phone. However, they become even more of a concern when you’re using a money app. By giving these apps access to highly sensitive financial info, such as bank passwords, personal data, and banking transactions, you become vulnerable to higher security risks.

And you’re certainly not alone in your concerns. Per a Pew Research study, when it comes to mobile payments, across different generations, American consumers are wary of financial technology and have ongoing concerns about security. So how can you go about safeguarding your data when using financial technology? Here are some of our top tips:

Limit Access to Specific Data

Some banks have created dashboards that enable you, the customer, to decide what information you want to share with these apps. For instance, you might give permission for a money app to access your bank transactions, but not details about your car loan.

Some banks have designated dashboards where you can go in and make these changes, including Bank of America, Chase, Citi, and Wells Fargo. The intended goal is to prevent “screen scraping,” which means money apps can pull whatever data they want from your account. By only allowing access to the necessary data, you can help limit your exposure and potential risk.

Don’t Use Public Wi-Fi

Avoid using public wi-fi, particularly if you’re using a mobile payment app such as Venmo or Zelle, recommends Steve Weisman, founder of Scamicide. However, if you must use public wi-fi, you should use a Virtual Private Network (VPN), which will encrypt your transaction. That way, would-be fraudsters won’t be able to access sensitive data shared on public wi-fi.

So how can you tell if you’re on a VPN network? You’ll want to visit a “What’s My IP?” page. If it reveals your actual location, that’s a surefire sign that you’re not on a VPN. On the flip side, if it doesn’t, then you’ll you’re using a VPN.

Lock Your Phone

Weisman also suggests making sure you lock your phone when you’re not using it. Why’s that? Let’s say you have money apps on your phone, and it’s unlocked. Someone who steals your phone can easily access your mobile money app.

And of course, create a password or pattern that’s easy for you to remember and hard for others to figure out. When creating passwords, no two should be the same. What’s more, you’ll want to use a combination of symbols, letters, and numbers.

Use Two-Factor Authentication

Two-factor authentication is a fancy way of saying you’ll need to provide at least two ways to prove that it’s indeed you logging on. This adds another layer of security. This goes beyond just plugging in your username and password. For instance, the app might text you a passcode, which you’ll need to input before you can log into the app. Or maybe it’ll send you a message on your phone to verify that you just tried to log into your computer.

Don’t Share Your Personal Information

You should never share your personal information to anyone, even those you trust, such as a partner, family member, or friend. If possible, opt to do a fingerprint login instead of a PIN. And to avoid having your money app accounts being overtaken by hackers, don’t ever share personal info with unknown third parties. This includes your password, username, or a PIN. In particular, be very careful when receiving an email, text message, or phone call asking for this type of info, warns Weisman. Most legitimate providers won’t contact you asking for sensitive information.

Only respond to these sorts of requests when you’re absolutely sure that the request is legitimate. And the chances of it being legitimate? They’re pretty slim. How can you confirm this? Reach out to your bank or other company by calling them at a number you know is legitimate. Look on their website or Google it for this information.

The good news? Let’s say your account is linked to a credit card. In that case, your credit card company will refund the amount that was stolen, explains Weisman. And if it’s tied to a bank account, you should be able to get the money refunded. However, you’ll need to report it immediately.

Know Your Protections

Before signing up for any money mobile or another financial app, you should familiarize yourself with their fraud protection rules, points out Weisman. For instance, the fine print of many P2P services spells that out, in the case that you use the app to make a transaction to buy something, and it turns out to be a scam, you might have very little protection. “That’s why these services should never be used for commercial transactions, but only to transfer small amounts of money to people you know,” says Weisman.

In an age when data is considered gold, you’ll want to do all you can to protect your personal information and sensitive data when using different money apps. By being vigilant and taking a few precautionary steps, you can keep your data and personal information safe.

If you’d like to get your head around all the financial technology out there, check out our many articles on the subject. And if you’re looking for custom, one-on-one advice, our team of accredited financial counselors are here to help.

Tagged in Financial technology, Financial scams

Jackie Lam - author photo

Jackie Lam is an L.A.-based personal finance writer who is passionate about helping creatives with their finances. Her work has appeared in Forbes, Mental Floss, Business Insider, and GOOD. She blogs at heyfreelancer.com.

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