Today, credit and debit card users say that the security of their accounts is growing more important, as identity theft and other types of crimes that can expose payment data grow more prevalent. As such, many would like to see more protections put into place.
One potential way in which consumers might be able to get more protection when they use their debit and credit cards is through a new technology that links those accounts with the user's mobile phone, according to a report from the tech firm Finsphere. A study conducted by market researchers Penn Schoen Berland found that, when presented with the potential for adding this extra layer of security, the majority of respondents said they would be very interested in using it, because it was easy to understand and utilize, added significant security to a transaction, and allowed for quicker detection of potential fraud on their accounts.
Inside the survey
In all, 75 percent of those polled (who owned either a debit or credit card, or both, as well as a mobile phone, and traveled more than 100 miles from their homes at least once a year) said that they would sign up for a new account that came with this type of security protection if it were offered by their financial institution, the report said. In fact, another 20 percent said they would consider switching from their current financial institution to a new one if this protection were available.
Further, about half say they would use their current accounts more if they had this security layer in place, the report said. Two-thirds or so said it would make them more confident in doing so.
"We were thrilled with the results of this study as they clearly attest to the intense appeal for identity authentication services like the solutions Finsphere provides today to major financial service organizations in the U.S. and the UK," said Mike Buhrmann, CEO of the company.
Any potential problems?
On the other hand, consumers seemed somewhat skeptical of the technology at first, but those issues were assuaged once the concept behind the type of technology in question was explained to them, the report said. At that point, consumers said they were more confident in both the security of their account and their financial institution and cellphone service provider.
In fact, where the wireless service was concerned, more than half said they would probably be more likely to use their new card if that company partnered with their financial institution to offer that added layer of security, the report said.
Why the clamor for more protection?
Credit card fraud has become a major problem in the U.S. in the last several years for a number of reasons, and consumers have only recently become more cognizant of the extreme damage that this type of fraud can do to their finances. As such, many companies in several industries are now working on ways to increase account security so that borrowers don't feel exposed.
However, various attempts to increase security features in a number of ways have been met with mixed results. For instance, experts say that the use of smartphones enabled with near-field communications technology will make credit and debit card purchases far more secure, but adoption among both mobile device manufacturers and consumers has been lukewarm at best. Though many projections show that widespread adoption of this payment method should come by the end of 2015, relatively few companies actually develop the necessary smartphones today, and borrowers haven't been quick to snatch up the existing products. Perhaps the biggest indictment of the burgeoning technology is that Apple, despite wide speculation to the contrary, opted not to include NFC in the iPhone 5, which was released a few months ago.
Meanwhile, payment processors are now trying to introduce new credit cards that come with a separate layer of security: EMV technology. This kind of card relies on both the traditional magnetic strip featured on nearly every card issued in the U.S. in the last 50 years, and a small embedded microchip that stores account data, which is harder for criminals to access and duplicate. However, like NFC smartphones that enable swipeless purchases, it's unlikely that EMV cards will catch on in the near future.
Of course, many consumers now place significant importance on account security, but may not do everything they should to adequately protect their finances. A crucial part of this is making sure to regularly order a copy of their credit reports to ensure there are no unfair markings that take a negative impact on their standings. Working with a credit repair law firm may help to clear up this issue if any such entries are discovered.