Ways to Protect Yourself When Making P2P Transactions

Don’t Be Scammed: 8 Ways to Protect Yourself When Making P2P Transactions

When it comes to making peer-to-peer (P2P) transactions, it’s important to be aware of the potential for scams.

According to insiderintelligence.com,  By the year 2020, about 18 million consumers have been victims of peer-to-peer fraud.

There are a few key things you can do to keep your money safe on these P2P apps.

Scams and fraud might not be completely preventable, but there are ways to lessen your risk.

You should exercise caution since after payment has been sent, it could not be reversible. And there might not even be safeguards in place to assist you to get it back if it’s lost.

Here are 8 tips for staying safe when making P2P payments

1. When utilizing a peer-to-peer (P2P) program to transfer funds, take your time. It may be a warning sign if someone is pressuring you to make a rapid decision.

2. Unfortunately, once a transaction has been transferred to another user via many P2P apps, it cannot be canceled.

For this reason, it’s best not to give money to or ask for money from somebody you don’t know and trust.

3. Please read the app’s legal disclaimer. Some app developers forbid their apps from being used for commercial purposes.

4. Your account is protected from potential threats by the protocols used by P2P software. Help them out.

Multi-factor authentication is only one such example. Multi-factor authentication, often known as “two-factor authentication,” necessitates the use of more than one piece of information to get access to a given resource.

The first is often your login credentials. Step two might include entering a code that was sent to you through email or text message. Fingerprint or face recognition might also be used.

P2P payment fraud stats

5. P2P apps facilitate the rapid transfer of funds. When you transfer money, it doesn’t take long to get where it’s supposed to go.

Make sure your money goes where you want it to by checking twice to make sure you have the right information.

6. If your bank provides fraud warnings, you should use them. In any case, don’t forget to check in on your own account sometimes.

If you have any reason to believe that something is amiss with your bank account, you should contact the bank as soon as possible.

7. When using P2P applications and other websites, use distinct passwords for each. Tools exist that may assist you if you are concerned about remembering them all.

Don’t give out your passwords like candy, and the same goes for your personal information.

8. Acting as a trusted institution like your bank or a P2P service is a common tactic used by fraudsters to get access to your account.

They might reach out to you by phone, email, or text message. It’s best not to click on links or provide any identifying information.

It’s possible they’ll tell you that transferring funds requires installing yet another software or granting them remote access. Keep all remote access to yourself.

Procedures to follow in case of a Scam

If you are the victim of a P2P payment scam, you should report it to the police and your local consumer protection agency. You should also file a complaint with the Federal Trade Commission (FTC) and the Consumer Financial Protection Bureau (CFPB).

What does a typical P2P payment scam look like?

These days, it’s possible to transmit money with a few taps or swipes on several peer-to-peer apps.
Because of the rapidity of the internet, dishonest people are able to take advantage of careless users.

Related: Are there any Money Apps that Accept Prepaid Cards?

Here are some common scams and frauds to be aware of

Consumer scams

A consumer scam may occur when a business promises to deliver a service or product but then fails to do so.

Are you protected if the service is incomplete, the product is damaged, or it never arrives at all?

Online purchase forums like Facebook Marketplace,eB,ay and others where buyers and sellers negotiate conditions of sale directly might open the door to consumer fraud.

Unless you are dealing with a reputable vendor, or have received the item in question, you should never send money before you have received it.

Account takeovers

Hackers can quickly access and transfer funds from your account through smishing or phishing.

This can often result in a change of passwords or usernames, making it difficult to regain your account or file a report.

However, experts say that much of the fraud is due to a lack of consumer education and bad guys exploiting the system.

Identity theft

If your personal information falls into the wrong hands, complete strangers might create accounts in your name on P2P sites and drain your funds.

Personal information such as Social Security and Bank Account numbers can be stolen in data breaches and used to open new accounts in victims’ names.

Smishing scams

Phishing and smishing schemes are all ways that scammers can try to steal your password.

To protect yourself from these scams, be wary of any message that asks you to click on a link or open an attachment, even if it seems to be from someone you know.

If you’re unsure whether a message is legitimate, you can always contact the person who sent it to you directly to verify its authenticity.

Conclusion

Payments sent from one individual to another, or “peer to peer” transactions, can be used for a wide variety of purposes, from sharing the cost of a meal out to settling a rent or utility bill.

By utilizing a smartphone app like PayPal, Zelle,Cash App, Google Wallet or Venmo, two people may send and receive payments directly from their bank accounts or credit cards.

As convenient as it is to transmit money, it is also an obvious target for fraudsters looking to steal money.

These programs’ sole function is to send money to pals, not complete strangers. The applications shouldn’t be used to buy and sell anything, especially with strangers.

You will not likely get your money back if the transactions are determined to be fraudulent if you allowed them, by which we mean you hit the button permitting the transaction to go through.

Terms and conditions often state that the consumer carries the risk of loss if the payment is allowed, which protects the majority of P2P app providers.

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