Earlier this month, Judy Cubiss warned us of the potential risks many industries face due to digitization. Online payment fraud was one of the problems touched on in the article. Due to the fact EMV standards are improving in physical stores, we’re going to see a surge in online payment fraud big enough to bring eCommerce stores to their knees.
There is no denying online payment fraud is a problem we’re going to face, but new technology means it’s not as clear cut as we’re led to believe. You only need to look at Bluetooth beacons to see there is potential payment fraud that won’t take place hundreds of miles away. We’ll find a way to ensure everything is secure, but let’s look at why the risks will appear in the first place.
A Lack Of Network Coverage
There are already enough problems concerning mobile payments when you’re in a store, so what are we likely to face when people are underground? Yapital have started to use wallets someone will be able to pay with when they’re in places where it’s impossible to get a reception. In you don’t have access to the internet will you even know anything is wrong until it’s too late to do anything about it?
The Hidden Dangers Of Up-Sells
We all know how used car salesmen have a reputation for up-selling you pointless upgrades, but we’re well aware it’s just marketing. Wells Fargo took it up a notch when it started signing customers up for a number of different things without their knowledge. It’s a well-known fact certain employees will do anything to make more money, so how will we stop it from happening when using beacons?
Payment Fraud Between Two People
This doesn’t have to do with Bluetooth beacons specifically, which makes it even more likely to be prone to fraud. If someone wants money from another person they’ll be able to receive it when both phones are connected through Bluetooth. What is to stop someone from working out how to steal money from everyone they walk past on the street? The deceitful technology doesn’t exist at the moment, but it eventually will.
Accessing Different Online Accounts
PayPal is one of the big companies looking to take advantage of beacons. They’re setting up devices in stores so companies will be able to accept online payments from customers. Instead of using a credit card which we’d use at the moment, people will be able to pay directly through an app. Will a random hacker with great computer skills be able to find their way in between the phone and the beacon?
Walking Out With A Product
Beacons don’t just open customers up to the risk of fraud. Companies could be vulnerable too, and you only need to realize people will be able to pay for things on their phone then walk out to see why. Do you think nobody will attempt to say they didn’t actually walk out with the goods they paid for? Can they say it was done on another phone? We’re going to see a lot of problems before we can come up with solutions.
Passing Rewards Onto Customers
Another thing companies need to think about is the way they deploy rewards to customers. Everyone has heard of ATMs throwing out money to a random person, which hurts banks financially. Will stores be able to stop someone from receiving hundreds of rewards they don’t deserve because they’ve found a vulnerability in the beacon technology? They’re not actually giving away money, but they’ll lose some when fraudsters redeem the rewards.
Delving Into Cryptocurrency
This is where payment fraud could begin to get the most dangerous. Beacons are going to suggest people pay using something like Bitcoin, which we know isn’t going to be easy to track. Unless something catastrophic happens money will be gone forever when we’re dealing with cryptocurrency. Luckily it’s not yet mainstream, so if there are problems they’re unlikely to affect you.
It’s Going To Improve Things
We’ll have to deal with fraud as we discover new things along the way, but eventually, it’s going to improve lives for the better. It’s going to revolutionize other areas of industries too, with logistics being the obvious example. It’s going to streamline things like we’ve never seen before, which means saving time and increasing profits. Who knows what we’re going to be seeing in a few years.