The organization is cautioning consumers to take care when using apps to send money.
AARP has issued a warning cautioning consumers about an increase in mobile payment fraud risk. It has warned individuals to take care when using peer-to-peer (P2P) payment apps which are rapidly rising in popularity during the pandemic.
The apps can be safely used but can also present notable security risks and challenges recovering money.
The concern is that not all of these apps are as secure as they should be. Moreover, even when opting for some of the better options, there remain certain security risks as well as potential difficulties in being able to recover money that was sent by mistake.
The stay-at-home and shelter-in-place recommendations have made smartphone apps a convenient way to be able to exchange money and complete transactions without any contact necessary. People are turning to delivery services for meals, groceries and other requirements during the pandemic. To pay for these services, they are using online transactions, raising the mobile payment fraud risk for many people.
The AARP mobile payment fraud risk warning was based on University of Chicago research findings.
The study was conducted on behalf of AARP by the University of Chicago. It involved the participation of 2,842 people across all 50 states. They were adults aged 18 years old or more.
The survey found that 71 percent of adults in the United States reported using mobile and online P2P payment platforms such as PayPal, Square, Google Pay, Apple Pay, Venmo and Zelle. Among those who are using those online transaction services, 24 percent do so sometimes, 35 percent do so frequently, and 41 percent do so rarely.
These apps are mainly used for sending money to friends and family. That said, half of the respondents said that they were also using P2P apps to send money to people they’d never transacted with before. It is in these areas that the risk begins to rise, regardless of the security of the application itself.
“We know scammers are already capitalizing on anxieties and fears around coronavirus. With so many people at home, consumers should be alert for possible scams on peer-to-peer payment platforms,” cautioned AARP Director of Fraud Prevention Programs Kathy Stokes who discussed the mobile payment fraud risk.