Technology is making it easier for friends, family and peers to transfer money easily. Sometimes all it takes is the click of a button, and you can transfer money across the country without ever leaving your home. While this type of innovation is a welcome change, it doesn’t come without some concerns.
These mobile app payment methods are known as peer-to-peer payment systems and have become extremely popular lately. They’re touted as an easy way to send money to friends and family without having to send a check through the mail or request a person’s banking information. There a number of P2P payment systems out there so finding the right one can be confusing.
The Federal Trade Commission and your Better Business Bureau have some advice for anyone wanting to use this service. First, you should read the applications privacy settings to ensure your financial information is secured. They should offer some type of data encryption to protect you against unauthorized transactions. Look closely at account settings to see if you need to enable any special security settings. Using two-step authorization is a great way to keep your account protected.
Next, you should know that when you receive payment, the money is added to your balance. It’s intended to stay there until the time comes for you to move it over to your bank account or use it for another transaction with a different system. Remember, the transfer could take a few days to go through. So, it’s best to wait for the money to clear before you spend it elsewhere.
And finally, keep in mind that P2P payments can be used by scammers. Con artists are notorious for requesting payment through unconventional ways, and these apps are no different. So, before you send a payment via a mobile app, make sure you know who you’re sending money to. Because once the money is sent, it becomes very difficult to get it back. If you decide to use the service to receive money from someone you don’t know — maybe as payment for an item you’re selling — be sure to transfer the money to your bank account and make sure the deposit clears before you send any goods. You should read the terms of service if you’re not sure if these kinds of transactions are permitted on the service you use.
To learn more about a company offering P2P payment services visit bbb.org.