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I remember the days when friends would remind me, “Hey, you still owe me money for that [purchase].” Each time I’d feel guilty because reminding myself to grab cash was always as difficult as remembering what I had for lunch two days ago. So, when Venmo came into the picture, I applauded its prime trait of convenience. No more would I have to run to the ATM to grab cash. Now, I can simply transfer money from my bank account to a friend’s bank account with just a few taps on my phone.
Along with Venmo, PayPal and Cash App have rapidly developed a popular reputation for convenient transactions. But let’s get one thing straight, there are risks to using these apps—just like every other digital platform that stores sensitive information. So, let’s go over those risks, how secure these apps are, common scams on the rise, and tips to give you an extra sense of security when using them.
Risks of Using Digital Wallets
When operating any digital platform that stores your personal information, it’s crucial to be aware of the potential risks involved. Knowing the negative possibilities will keep you one step ahead from putting your money in harm’s way.
- Can be vulnerable to security breaches
- Scammers attempting to trick users into sending money through phishing
- Hackers breaking into your account and using it to steal your money
- Scammers disguising themselves as someone you know to get your login information
- Strangers not paying for a sold product or service
- Buyer and seller protection is lacking in cases of non-payment or fraud*
*Paypal does offer buyer-seller protection, but Venmo and Cash App do not.
Are these Apps Secure?
Generally, these apps are safe to use. They all use similar encryption standards to keep your personal information and money safe from dangerous parties. Below we summarize the security systems they have in place and how you can contact support with any questions.
Venmo’s security system stores sensitive information on servers in secure locations and uses encryption protocols to protect its users. Through an API, they’re able to provide a safe environment for users to complete digital transactions. When in a web browser, ensure “https” is in the URL and a lock icon is next to it. This is your sign that Venmo’s encryption protocols are turned on.
If you see any suspicious activity on your account, you should contact their support team right away. Since they do not offer buyer-seller protection, there may be little they can do to help.
Like Venmo, PayPal also uses a security system with high-standard encryption protocols and stores user data in secure server locations. What sets them apart is their ironclad buyer and seller protection agreement. For buyers, PayPal promises to reimburse when they do not receive an eligible item or the item does not match the seller’s description. For sellers, PayPal can help mediate the transaction if you receive the wrong payment amount or eligible items are not received by the buyer.
If you have any questions about their security system, access PayPal’s extensive resource center for answers and ways to contact them directly.
Cash App also uses encryption technology and secure servers to keep your data and transactions safe from hackers and scammers. As a PCI-DSS (Payment Card Industry Data Security Standard) Level 1 merchant, Cash App completes at least 1 million transactions each year—noting them as a widely accepted merchant who aims to protect users against the exploitation of personal information.
If you wish to speak with a Cash App representative, contact their team through the app, web, or phone.
Common Scams on the Rise
If it seems too good to be true, then it probably is. Engrain this in your mind now! Scammers are out there every day attempting to take advantage of Venmo, PayPal, and Cash App users and steal money from your accounts. If you encounter one of the scams below, then you are most likely a targeted victim and should not comply.
Customer support impersonators
Scammers seek to fool money transfer app users by impersonating a customer support representative through texts, phone calls, or social media messages. To make themselves even more believable, they create fake websites and phone numbers that seem legitimate through a Google search.
They’re most likely trying to snatch up your password or PIN to access your account, so never respond to these messages or comply with their request!
According to the Better Business Bureau, reports have been made from Cash App users who lost thousands of dollars after speaking with an alleged customer support representative.
Fake offers and sweepstakes
Another common scam taking place is when thieves create fake raffles for users to win cash prizes. These often ask you to send a few dollars or your login information to enter and it’s all a ploy to steal your hard-earned money.
If you want to enter any sweepstake from Venmo, PayPal, or Cash App, make sure you’re interacting with their “verified” social media accounts—which show a blue checkmark next to their username.
Fraudulent charity and relief programs
Amid the COVID-19 pandemic, scammers are trying to swindle kind donors out of their money. These fraudsters spin up fake grant programs and ask for payment to receive certain benefits. Again, do not interact with these requests! Also, watch out for natural disaster charities or relief programs that are “in need” of financial help to provide resources for displaced people.
Money-flipping on social media
Another popular scam taking place throughout social media apps is cash-flipping. Cybercriminals will promise to flip your money when you send them the funds through a money transfer app. In other words, if you send money they will claim to send you back double or triple the amount you gave.
Keep your money safe and only send funds to people you know. You have the upper hand, so don’t let strangers scam you out of hundreds of dollars.
Tips to Keep Yourself Safe
Now that you are aware of the risks, security systems in place, and real-life scams, it’s time to equip yourself with the tips necessary to keep your money safe when using Venmo, PayPal, and Cash App.
- Don’t engage with strangers. Only trust people you know when sending and receiving money.
- Keep your apps up to date. Update your money transfer app(s) when a new version is released or ensure you have automatic downloads turned on in your device settings. This will secure your software with the most recent security bug fixes.
- Immediately transfer money to your bank account. Don’t let your received funds remain in your money transfer app(s). Transfer the money directly to your linked bank account, so the money is not vulnerable to theft.
- Avoid public WiFi connections for transactions. Public WiFi connections are more susceptible to cyber attacks, so aim to complete digital transfers through a secure network.
- Use a credit card when possible. Unlike a debit card, credit cards don’t have actual cash funds to access, so it’s a safer bet to use for money transfers.
- Use a VPN. A virtual private network will provide an extra layer of security and will keep all of your data and digital wallet safe through the highest level of encryption and secure servers.
- Be vigilant when receiving links in emails or texts. If you receive an email or text from Venmo, PayPal, or Cash App with a suspicious link, do not engage with it. These may seem legit, but they most likely link out to fraudulent websites to steal your money or account information.
- Change your password(s) regularly. It’s vital to routinely do this with any platform that stores sensitive information. Also, remember to change it to a password unique from other accounts you use.
- Opt-in for any password authentication options. This may include a PIN, face ID, fingerprint scan, and/or two-factor authentication.
- Check your activity logs regularly. If you’re very active on these apps, make sure you monitor these logs weekly to verify every transaction is legitimate.
- Immediately report suspicious activity. If you see anything completed without your consent, contact your bank or credit card company and report the dispute to your money transfer app.
- Set up a PIN and/or Face ID on your device. In case your phone is stolen or lost, no one can enter your device and access your apps.
Better Safe Than Sorry
There’s no doubt that Venmo, PayPal, and Cash App have revolutionized digital transactions. Now more than ever, it’s easier and more accessible for people to receive and send money. But, this convenience can come with a hefty price if you’re not smart about it. Get one step ahead by using our tips to keep yourself safe from scammers and hackers attempting to steal your money!
If you’re interested in learning more about using a VPN, check out the best providers for security and privacy—all tested and reviewed by our VPN experts.