The boost Apple Pay has given to mobile payments is a good thing, I believe, but recently reported fraud associated with Apple Pay is of concern to me. Also, I read about some LexisNexis findings that 25 percent of fraudulent transactions stem from the mobile channel, but mobile only accounts for 14 percent of all transactions. Shouldn't that give us pause? How can we know that by encouraging our merchants to adopt a mobile payment scheme they won't be putting their businesses in harm's way?
Derek Frazier, Merchant Level Salesperson
It's wise of you to be concerned about whether mobile solutions you may offer might increase your merchant customers' exposure to fraud. An article in this issue's news section, "Who's to blame for Apple Pay fraud?", delves into fraud that cropped up in conjunction with certain Apple Pay transactions, and while it is not good news, it does appear to be something the issuing banks and Apple Inc. will be able to sort out and prevent without undue difficulty.
Any time a new technology is employed, fraudsters will pounce to see if they can find and exploit vulnerabilities unforeseen by the technology's developers and early adopters. Companies that care about their longevity in the market, and the health of the payments system overall, will address these gaps, and those who do the best job will come out on top. Also, absent specifics in the report you mentioned regarding which mobile payment schemes are experiencing excessive fraud, it's difficult to base any conclusions on the merits of particular mobile payment options you may be considering for your MLS toolbox.
Promising mobile solutions are emerging. Ask for help from your ISO and peers in vetting the ones that look like the best fit for your merchants. This will help you guide your merchants into mobile payment acceptance without having to carry the fear of exposing them to excessive fraud.
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