Report claims weak ID checks by partner Apple Pay banks leads to an increase in fraud rates
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Report claims weak ID checks by partner Apple Pay banks leads to an increase in fraud rates

  • 2015-02-13 13:18:43
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News / Mobile phones Report claims weak ID checks by partner Apple Pay banks leads to an increase in fraud rates

Apple Pay is the safest mobile payment service out there, but it looks like Apple’s partner banks are not taking the correct precaution to avoid basic credit card thefts and frauds.

According to a report from mobile commerce firm — Drop Laps — some of Apple’s partner banks have seen an increase in fraud by up to six times because of the lack of proper ID checks by them when a user adds their cards to Apple Pay.

The post from Drop Labs explains that all banks are required to build a “Yellow Path,” where in the bank is required to verify the card details entered by the user in Apple Pay.

Apple had initially made “Yellow Path” optional but changed its mind and made it mandatory just a month before the launch of the service. This led banks scrambling to build the path, which in case of certain banks only redirects the user to a call center. Other banks, however, do make use of their mobile apps or two-factor authentication that is more secure.

Nevertheless, fraudsters are able to get credit card information from the Internet and are then successfully able to add it to Apple Pay after which they are able to successfully make any number of transactions in retail stores.

Keep in mind that Apple Pay in itself is secure as it relies heavily on Touch ID, a Secure Element, and does not share full card details with the seller.

[Drop Labs Via Gizmodo]


Categories: Mobile phones

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