Trusting Your iPhone Versus Your Wallet
Simple is better. When using your smartphone as a contactless payment, there’s no need to fumble through pockets and purses for plastic cards or identification.
“The days of the wallet are numbered,” says Apple developer, Jason McCray. As technology continues to advance, Pat Phelan reports for TechCrunch that a shift to Apple Pay and other tokenized payment systems “is our best hope to stop fraud.”
Apple Pay transactions are verified with your fingerprint. “Apple uses military-grade technology, to secure these payments.” says McCray. He says this technology is safe and secure because no two people have the same fingerprint.
One of the biggest privacy measures in the Apple Pay system is the Secure Element – a confidential chip built into every iPhone 6, iPhone 6 Plus and Apple Watch which cannot be read by other apps or software.
According to Express, Apple Pay will never reveal your card number or details to the merchant when you pay – making it more privacy – focused than current payment systems.
Instead of the details on your credit or debit card, which are revealed when using contactless or chip-and-pin, Apple creates an entirely new “Unique Device Account Number”.
Your actual credit or debit card numbers are never shared by Apple with merchants or transmitted with payment. Apple keeps your identity a secret throughout the payment process.
Switching to Apple Pay will make both your data and the entire payments landscape more secure, especially if a large number of users who already have the capable hardware in hand decide to start using the system.
Due to the added layer of biometric security, Apple has not set a cap on transactions, unlike current contactless credit and debit cards which are limited to $30 and under.
Juquan Vickers, sales associate at Office Depot witnessed a customer purchase $3,000+ of Visa gift cards using Apple Pay. He was suspicious, but could not question the customer because of Apple Pay’s security.
“I didn’t know what to do, couldn’t do anything. But, I wondered if it were actually his phone,” says Vickers. Because of the overall value of the gift cards, Vickers was required to get his supervisor to override the request. “I hope he wasn’t using someone else’s card — who knows, but if the fingerprint worked, I guess he had the information somehow.”
No one shares the same fingerprint. After fingerprint verification, when making a purchase, “…the Device Account Number, along with a transaction specific dynamic security code, is used to process your payment,” Apple explains.
There have been a widespread adoption of chip cards within this country. “This will help Americans break up with the magnetic strip card and embrace the security of better payments,” says Marty Whoitmore, vice president Boston Retail Partners.
In order to stop the coming surge of fraud, it’s time for all parties to double-down on making secure payment systems work for the consumer.
Most consumers support Apple Pay because of it’s convenience. It’s wildly simple, although the process might be slightly different depending on what store you’re in.
When you’re ready to pay at a store with a contactless terminal, you hold your iPhone close to the device. The Apple Pay interface opens and shows the credit card you have set as the default.
“As with any new technology there is a learning curve associated with that technology,” said Whoitmore. “Retailers need to continue to educate the consumer on the availability and the benefits of using their Mobile Wallet and continue to move toward acceptance.”
“Our smartphones are our everything, we use them more than anything else in life,” said Wade Adams, an Apple Pay user. He says he trusts Apple and is sure his information is safe. He does wish there were more benefits to thepayment method.
In effort to expand the use of Apple pay, consumers suggest Apple offer cash back or rewards, that they’re used to getting when shopping with major credit cards.
Should College Students Have Credit Cards?
Going to college is all about learning lessons, but many of the most important bits of knowledge we accumulate over the four years we spend on campus don’t come from the classroom.
For example, ramen noodles and a soda don’t constitute a balanced diet; laundry needs to be done more frequently than once a month; partying all night before a midterm doesn’t make for straight A’s. All of these are important life lessons that no professor is likely to teach.
Likewise, another important set of skills that you won’t likely learn in any college class is how to manage your money. Managing money is a challenge most college students face and banks and credit card companies are aware of this trend. Unfortunately, the average college student uses a credit card during financially challenging times.
Credit cards aren’t so bad if used responsibly. If you go into handling your first credit card with your eyes wide open, you won’t make any of the difficult money mistakes that your colleagues may face.
A recent survey in the International Journal of Business and Social Science found that half of college students own four or more credit cards. “I have six credit cards, but I only use them for emergencies,” said Samantha Lennon, student at UNF. She says credit cards are good to use when the funds in your checking account get low.
According to U.S. News Money, financial advisor and CEO of American Consumer Credit Counseling, Steve Trumble says, “It’s best to pick a one card that suits your needs, give you practice with establishing good credit habits like managing spending, paying bills on time, and staying out of debt without the pressure of having to juggle multiple cards.”
Due the passage of the Credit Card Accountability Responsibility and Disclosure Act (CARD) in 2009, credit card companies aren’t permitted to aggressively market to college students anymore. Students must now demonstrate financial capability or have a creditworthy co-signer in order to get a credit card, but the requirements are still lax.
Credit cards are accepted nearly everywhere these days, therefore tracking your spending on a credit card can be complex. Trumble said, “The average student isn’t just making a few purchases a week with their plastic – they’re probably making several dozen.”
Failing to keep track of how many purchases you’re putting on your card can lead to big trouble – namely a big bill that you can’t pay off within 30 days.
College is a really busy time – you’re going to class, working, spending time with friends. It’s easy to let the little details slip your mind. But, a credit card bill isn’t one of those times.
Lennon said, “I’m very forgetful. I always have a lot on my mind, and a credit card bill isn’t as important as my grades.”
Failing to pay your credit card bills on time could seriously damage your credit score, and can make it difficult to get a home or car loan when becoming an adult.
When you’re young and studying hard, it’s easy to envision a future where you’re making tons of cash doing a job you love. Then you say to yourself, “I’ll be able to pay it off later,” right?
Not quite. Developing an “I’ll pay for it later attitude” isn’t the most responsible thing to do. Most college graduates have had a tough time landing jobs, so don’t assume you’ll immediately transition into a career that’s well paying enough to tackle your huge credit card debt.
It’s best to spend responsibly with your card – only charge what you’ll be able to pay off within a month.
According to a recent survey of more than 1,000 college students by CreditDonkey.com, only 63 percent said their parents helped them learn about managing their money.
“My mom and dad always told me to be cautious about getting credit cards” said Sasha Hemmingway, student at UNF. Her parents have always been strict about saving money and advised her to avoid credit cards at such a young age.
In fear of damaging your credit, it's tempting to just avoid getting a credit card, but if you take this approach, you probably won’t be doing yourself any favor.
The length of your credit history determines fifteen percent of your credit score. It’s crucial to start building that history right away.
As soon as you’re able to qualify for a credit card, get one and use it responsibly. Not all lessons have to be learned the hard way. Trumble says, “Students should keep up with their finances as carefully as they would their schoolwork."