Consumer Advocate

Sign up for newsletters and other news
Media > Newsletters > Consumer Advocate > August 2018 > New Electronic and Mobile Payment Methods

Consumer Advocate RSS feeds

New Electronic and Mobile Payment Methods

Consumers today often have a variety of options when it comes to paying for products and services – from cash and credit card to mobile wallets and peer-to-peer payment apps. As new methods are developed, it is a good idea to review the features and security of each method.

In addition to traditional forms of payment, such as credit cards, debit cards, bank checks, or cash, there are now other options and features.

We’ve grouped new electronic and mobile payment methods into three general categories — online banking, mobile wallets, and standalone payment apps — and we’ve listed factors to consider about each.
Online banking generally allows you to set your bank account to provide recurring payments to approved vendors. For instance, you might set up automatic payment plans for monthly bills, such mortgages, utilities, or loan payments, for convenience, to save on paper and postage, or to help avoid late fees for forgetting to pay bills. When using this feature, it is important to track your bank accounts to ensure you have enough money in an account when payments are debited.

Many mobile banking apps also allow consumers to send and receive money directly between banks. Some banks allow these transfers only between accounts housed within their banks, while other apps allow for transfers and receipts from any bank.

Mobile wallets generally allow you to carry and use your credit, debit, or gift card information in a digital form on your mobile device. Rather than carrying and swiping your physical card to make a purchase, you use your phone instead. Mobile wallet apps have the potential to be safer than credit cards if used with mobile-device security. For example, if you use a passcode or PIN to unlock your phone, that also can serve as a form of security needed to access the credit card or bank account information stored on your phone. The downside is that if all your financial information is stored on one device, if the app is hacked or you lose your device, the consequences could be severe. In other words, losing your phone could be like losing your wallet too.

Standalone payment apps generally store your payment information and allow you to pay a particular merchant or person using the app. For example, if your favorite restaurant has a payment app, it may allow you to order and pay for food at that restaurant through its app. Other standalone payment apps can give you the ability to conduct person-to-person transactions, such as paying a friend by transferring funds from your account to your friend’s immediately. 

When using online banking, mobile wallets, or standalone payment apps, be sure to understand the security features and risks of each. These payment methods are generally secure, but it’s important to follow security protocols. For example:
  • Maintain a strong password on your mobile devices and apps.
  • Do not use free, public Wi-Fi to shop using any passwords or credit card numbers.
  • Make sure the app you are downloading is the legitimate banking or mobile payment app, not an imposter with a similar name or look. 
  • Read the terms and conditions to see if there are fees associated with any of the payment services and whether transactions can be reversed or refunded. 
  • Always make sure the person you are paying is the actual person you want to receive the money. (Otherwise, if you send money in what turns out to be a scam, it may be difficult to recover your money.)
  • Beware of “phishing” scams, or emails and texts designed to look like they are from your bank or mobile payment app that seek your personal or financial information. When in doubt, contact the company at a phone number that you know to be legitimate.  
Consumers who suspect a scam or an unfair business practice should contact the Ohio Attorney General’s Office at  or 800-282-0515.