Demonetisation of high value notes and the following cash crunch have pushed people towards adopting e-wallets for their daily transactions. More and more people are now going the cashless way to avoid queuing up outside banks and to transact conveniently using their smartphones while sitting at home. The increasing demand for e-wallets have seen several merchants tie-up with e-wallet companies to expand their user base and offer cashless payment options along with discounts and cashbacks to their customers.
This digital instrument has replaced the conventional wallet as it allows you to keep money in it for instant payment towards multiple platforms without having to key in your details for every transaction. So, keeping it secure is a primary concern. Although most popular e-wallet providers comply with RBI’s security specifications and have added layers of security, you must do your bit to keep it safe.
How does an e-wallet work?
An e-wallet is a virtual wallet where you can keep money in digital form. You can load the wallet as and when you want by transferring money from your bank account. You can buy goods and services from retailers, transfer money to others, and transfer money to and from your bank account. However, there is a limit to the amount of money that you can keep in your e-wallet.
According to the current RBI norms, you can hold up to Rs 20,000 in your e-wallet, and you can stretch it up to Rs 1 lakh after fulfilling KYC requi-rements. Your spending limit is set accordingly. E-wallets can be open, semi-open, closed and semi-closed in nature. The e-wallets in the payment space in India are semi-closed in nature and can be used for goods and services at select merchants who're using the same e-wallet as you are. E-wallets do not allow cash withdrawal or redemption by the user.
How to keep your e-wallets secure:
In the absence of two-factor authentication on e-wallet transactions, there is a risk of your e-wallet being misused should your phone be in the wrong hands. If you lose your phone, the person who lays hands on your phone could have access to your e-wallet. This could lead to unauthorised transactions. Using a public Wi-Fi could also reduce your security. How do you protect yourself from such vulnerabilities?
A few steps to keep transactions safe:
Some e-wallets don't have two-factor authentication, nor is there a confirmation screen where you are asked to approve the details of the transaction. Once a payment has been processed, it may be difficult to retrieve it. Therefore you always need to be careful about details such as the payee's phone number and amount. Double-check these before hitting the “submit” button.
Losing your phone is almost like losing your wallet as your phone has all your financial information stored in it. To protect your financial apps even when your phone is unattended or lost, enable your phone screen lock. As an added measure to prevent misuse of an unlocked phone, install an app lock to protect apps with sensitive data. There are apps that lock the phone and click picture of the user after three failed log in attempts, while there are some that wipe the phone’s memory if there are multiple failed attempts to unlock the phone.
Assuming that all other measures have failed, a person misusing your e-wallet will have access to the funds stored in it. To minimise misuse, keep a low balance in the e-wallet. Don’t add more than a few thousand rupees at a time. If you suffer a loss, it would be minimal.
Once you start using an e-wallet, it will keep you logged in by default. When you close it and relaunch it later, you won’t be prompted for a password. This is a risk. Always log out of your e-wallet after every transaction.
With most of your transactions taking place through your smartphone, it is very important that you keep your device protected from virus and malware. Any malware downloaded and installed by mistake have the potential to spy on and steal personal information stored in the phone, thus leading to identity theft and illegal transactions. To keep hackers at bay, download and install a virus scanner to scan and quarantine any virus that accesses your data. Make sure you download the anti-virus software from a reliable app maker. Which brings us to our next point about where to download apps from.
Download apps only from app store:
To meet the growing demand for e-wallet services, several websites and vendors have entered the e-payment ecosystem through their own e-wallets or through third-party service providers. While some wallets have proven to have strong security features, others may still be fighting vulnerabilities. Before you use any online wallet service, look for reviews and ratings of the service. While using apps, download only from official app stores, not from links on the internet, and only after going through the app's reviews and ratings.
With most of your transactions taking place through your smartphone, it is very important that you keep your device protected from virus and malware.
(The writer is the CEO of BankBazaar.com)
