As new forms of payments emerge, the need to safeguard the security of consumers has been increasing. The advent of smartphones & new technologies has generated a range of online apps, but with these opportunities come risks, particularly as the online/mobile device has a different set of vulnerabilities and service arrangements.
The existing approaches banks use to manage fraud are broken! Fraud occurs before it can be detected and its identification is not very accurate. It takes a long time to resolve fraud causing consumer frustration.
Most banks typically manage fraud in two ways. The first approach involves enabling necessary platforms and tools as well as enforcing policies that help in identification and prevention of fraud. The second approach involves refunding consumers for any loss due to fraud. The latter approach is worse because it “trains” consumers to be negligent of their surrounding environments.
Almost half of US mobile users are interested in mobile-based account control for debit cards, like tools that allow them to control their spending and avoid fraud.
With these apps, users will be able to set limitations, track transactions, and even enable payments by proximity, which means a card can only be used wherever you are (your phone, essentially). If your card is left behind at a restaurant or, worse, gets stolen, it’ll get denied if you’re on the other side of town.
Note: Top 2 box; *Smartphone or tablet users Source: eMarketer.com, Mercator Advisory Group
Mobile-based account control for debit cards can be beneficial for users from a security perspective. And users may feel more secure with added features to their mobile banking app. There are some companies that let the user control their debit with the help of mobile:
CardValet: CardValet from Fiserv is a card management and fraud mitigation tool that enables cardholders to control when, where and how their debit and credit cards are used.
CardControl: Ondot empowers consumers to control payment cards from mobile phones. The startup has showcased its app with the help of which consumers can set control preferences to match the desired usage profile for their own cards as well as their dependents' cards, and change it instantly when needed, all with a touch on a smartphone app.
"We created a way to let people use their mobile phone as a remote control for their existing credit and debit cards," Vaduvur Bharghavan, Ondot's CEO and Founder, said to CNBC.
CardNav: CardNav by CO-OP lets members manage control of their debit and credit cards using a smartphone app. It's great for business members whose employees use company cards, for parents wishing to monitor their children's spending and for anyone wanting to ensure their cards are being used how they want, where they want.