Apple Pay, PayPal, EMV cards: What’s the safest way to pay?

(WOOD)

(WOOD) — As fewer Americans carry cash, they face more payment options at checkout than ever before.

The number of monthly active users of Apple Pay jumped more than 450 percent between June 2015 and June 2016, data shows.

Online payment giant PayPal is also looking to grow – recently teaming up with MasterCard to allow users to link their credit card in their PayPal wallet. The partnership means less actual card swipes for customers and keeps credit card numbers out of the transaction.

“With the PayPal proposal and the Apple Pay, it’s contactless. And by saying that, no credit card information is being passed to the merchant. Only a user ID is being passed to the merchant so it’s a much safer way to go,” explained Grand Valley State University finance professor Dr. Eric Hoogstra.

In June, PayPal announced a similar partnership with Visa. Hoogstra says the partnerships aim to even out the playing field as PayPal competes with Apple Pay.

And even though both tout secure transactions, Hoogstra says nothing is guaranteed.

“It’s a very competitive market and unfortunately there’s no way to 100 percent protect yourself against fraud in a transaction,” he added.

The United States is one of the last to switch to credit cards with chips, which are touted to be more secure. However, online fraud experts say fraud actually jumped in every country after initially making the switch to EMV cards.

Thieves are able to steal the card number and expiration date and use them online in what’s called ‘card not present’ or CNP fraud.

Hoogstra says for now, contactless payment options like Apple Pay and PayPal may be the most secure, but they’ll never be as secure as simply using cash.

“It’s always going to be something and there’s never a 100 percent way to protect yourself,” He reiterated.

To protect your funds, here are Hoogstra’s suggestions:

  • Save your receipts and compare them to your statements regularly.
  • Never sign a blank receipt.
  • Keep your eye on your credit card during all transactions.
  • Carry credit cards separate from your wallet.

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