We witnessed a surge in the use of mobile wallets after demonetisation. As 86 per cent of cash went out of circulation, buyers and sellers were compelled to adopt digital modes of transaction. Companies manufacturing POS (point of sale) machines were battling to meet the overnight surge in denmand thus leading to an increase in mobile payments.
UPI transaction volumes increased by 1,331 per cent from 0.29 million in November 2016 before demonetization — to 4.15 million in January 2017 after demonetisation.
The offers through cashbacks and discounts also catalysed the price conscious consumers to use these wallets; to purchase goods and services and P2P transfers. Though the exposure for consumers transacting online increased, so did opportunities for fraudsters. As per Experian’s Fraud Management Insights 2017, Indian consumers have the highest exposure to online fraud within Asia Pacific and also have one of the highest fraud incidents within the region. This points to one important question. Would all these consumers be protected against ID theft if they were using wallets? The answer to this depended on the precautionary measures one adopts while using such applications.
Here are few precautionary measures that can help you avoid fraud while using e-wallets:
Only believe in a trusted source: It’s important to download a digital wallet that is trusted and is from a credible source. Attractive benefits such as discounts or cash-backs might sway the user at times. But this might lead to compromising identity and result in unauthorised transactions and come as a rude shock to you. Public internet is a complete no: At the time of making transactions, a user should only use trusted internet bands and avoids using public Wi-Fi at airports and railway stations. This will help them in being sure that the transaction is hassle-free and there is no malicious third party to interfere with the transaction.
Prefer security to ease: There are times when the user might overlook security and reach for ease by saving their card details in the wallet. This might be safe according to wallet providers but it’s always better to be safe than sorry. Not saving your cards on the wallet might make the process of refilling a bit uneasy as you might have to take the card out every time for details. But it’s an advisable precautionary step. In addition, the user can also use internet banking to replenish wallet, which might be easier than pulling out a debit/credit card every time you do a transaction.
Make password difficult to trace: The wallet users should routinely change their password. It will help in making the password difficult to backtrace. The password should also have characters that are not relatable to the user, they should avoid saving password such as the name of their pets, date of birth, child’s name and phone number.
Don’t share your OTP: Never share your ‘one-time password’ (OTP) with a third party, especially when you haven’t made any transaction or had a top up of your wallet. Your e-wallet account is just like your bank account and must be kept confidential.
Read small print: When opting for a new e-wallet always make sure that you read and understand the terms and conditions. Many a times users accept conditions in a hurry without going through the terms. The fine prints have important facts like privacy details that will help you know whether your personal information is being shared with a third party or not.
Get a basic malware scanner: Malware is a contraction of malicious software. It’s a software written with the intent to harm data, devices or to people by disrupting, damaging or gaining unauthorised access to a system. This can be in various forms such as virus Trojan and spyware. Getting a malware scanner, commonly known as an anti-virus, for your phone will help detect and eradicate such malicious software.
Use biometric security: The use of biometric has further added security to the process of online transaction. Something as basics as letting the home button scan your fingerprint to authenticate and complete a transaction is based on biometric. Recently wallets have also added the feature of biometric-enabled transactions that will help users avoid fraud and make payments secure. It’s an important feature that wallet users should avail.
Set a limit to your wallet: Make sure to try and limit the amount of money that you are adding to your e-wallet so that in case of fraud, you don’t lose a lot of money. In addition, keep a tab on the balance. In case of fraud, reach out to your wallet provider immediately to raise the issue.
Put a lock on your phone: As per RBI rules, a user is allowed to store up to Rs 10,000 in their digital wallets but if their KYC is verified, they can store up to Rs 1 lakh. The smartphones on which this money resides has a high probability of getting lost. This makes it even more important to secure this digital money that lies in the wallet. Hence, users should protect their phone by putting a pass-code in case the phone gets lost. You may lose your phone but still keep your money.
With the recent RBI guidelines that require higher compliance standards, e-wallets are now coming up with virtual prepaid cards to increase their acceptability at merchant stores. This might further boost usage for existing and new wallet users. This increasing exposure of e-wallet usage also signals to an increasing need for better fraud prevention measures to be taken by the users.
The author is managing director Of Experian Credit Bureau and country head of Experian India