Consumer Protection

Advice for Consumers About Making Mobile Payments

Privacy and Security Are Important Concerns as Consumers Increase their Use of Mobile Payment Systems

Washington, D.C. – In the face of growing concerns about security and privacy, the Consumer Federation of America (CFA) is today releasing new educational materials about protecting your privacy and security when making mobile payments. These consumer tips explain how mobile payments work, the kinds of personal information that could be collected when they make mobile payments, how to avoid security pitfalls, and the steps to take to keep mobile devices, and the information they contain, safe and secure. This information is being released in coordination with National Consumer Protection Week.

“Smartphones phones, tablets and other mobile devices can contain a lot of sensitive personal information, and when consumers use them to make mobile payments even more information can be gleaned about them, such as their locations, who they do business with, how much they spend, and what they buy,” said Susan Grant, CFA’s Director of Consumer Protection and Privacy. “It’s important to know what information is collected, who has access to it and how it’s used, and to take advantage of any controls that are offered, especially since there is no comprehensive federal law that protects consumer privacy.”

Security is also an important concern. In a survey that was conducted for the Federal Reserve in December 2014, 59 percent of mobile phone owners who hadn’t made mobile payments cited security as the main reason. “Mobile devices that can access the Internet are basically personal computers that you carry with you,” said Ms. Grant. “Consumers should take the same precautions as they do to protect their home computers from malware and other threats, and with mobile devices they also need to think about the lack of security using free public Wi-Fi and how to prevent others from using their devices if they’re lost or stolen.”

Another issue is what to do if something goes wrong with a mobile payment. “Because there may be many different companies involved in the mobile payment process, it can be confusing to figure out who to contact if there is a problem,” said Ms. Grant. As the tips explain, consumers’ rights to challenge payments are also complicated because they differ depending on whether they are made with credit cards, debit cards or prepaid accounts, and when charges are made to consumers’ wireless accounts, there is no federal law that provides payment dispute rights.

Produced with a grant from the Digital Trust Foundation, CFA’s new materials on mobile payment privacy and security also include a humorous video and two ready-to-use news articles. All of these materials are available at www.consumerfed.org/mobilepayments. CFA thanks Marianne Crowe, Vice President of Payment Strategies with the Federal Reserve Bank of Boston and David Lott, a payments risk expert with the Federal Reserve Bank of Atlanta, for their input as this educational information was developed.

Contact: Susan Grant 202-939-1003


CFA is an association of more than 250 nonprofit consumer groups that was founded in 1968 to advance the consumer interest through research, advocacy and education.