A Spotlight on Mobile Wallet Fraud in eCommerce Payment

Nov 26, 2019

With online sales multiplying by the day, and 2020 predictions for the sector approximating at trillions of dollars, merchants must understand key market trends to stay afloat in a dynamic market.

Payments, for instance, are vital in making the sales process successful. With the advent and widespread use of cellphones, the adoption of mobile wallets have increased, and so have cybercriminals continued to target these platform.

So what is the status of mobile wallet fraud and what’s the eCommerce payment industry doing to protect online buyers in the future?

Mobile Wallet Fraud

Mobile wallets are a popular payment method attracting millions and billions of users, as seen in Apple Pay and Alipay, respectively.

But fraudsters love to exploit new flourishing markets. These apps allows for easy payments; card data is entered into the app and these turn into tokens each time a buyer is to pay.

One security risk noticed in Apple Pay three years ago was the possibility of a fraudster seizing a customer’s card data and attempting to load funds into another Apple Pay wallet.

Tests conducted by Pin Drops lab proved that it was indeed possible to load a fraudulent mobile wallet account with a shopper’s credit card.

Apple Pay, however, managed to fix the issue a few months later and cybercriminals can no longer steal from customers through that method.

Combatting Mobile Wallet Cybercrime

As an extra layer of security, many upcoming mobile wallets are adopting SMS verification to reduce the levels of fraudulent credit card transactions.

The tech adds an extra authentication procedure by asking a buyer to enter a confirmation passcode sent to their mobile phones each time they wish to make a payment.

That is to say, a cybercriminal cannot have breach your mobile wallet unless they literally get hands on your mobile phone.

Industry experts are hopeful all app providers will soon implement this security measure.

Other than SMS verification, bigger players have leveraged the power of artificial intelligence to secure their platforms.

Alipay now protects its platform with a risk mitigation machine it calls Alpha Risk. The tech uses an active learning risk alert mechanism that looks though various payments to authenticate accounts and make sure no data is stolen.

Wrapping Up

With the evolution of the online payment sector, industry players must look for ways to safeguard customer data and augment the security of their platforms to offer the best purchase experience.

Let us help you get a high risk merchant account today!

Get Started

Award winning.

  • 2012
  • 2013
  • 2014
  • 2015
  • 2016

Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending on the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

Live Chat