New security safeguards introduced for online payments

contactless-spending

According to the Financial Times, online payment methods will be subject to two new security methods, giving consumers who use online or mobile banking increased protection.

Before the consumer makes a payment, the two new safeguards introduce heightened security steps to avoid errors and ensuring the payment details are correct and confirmed.

‘Confirmation of Payee’, is the first step, where users submit details of their payee and the details then re-appear on their screen, confirming the details and of the account. The second safeguard being introduced is ‘Request to Pay’, created for those who have regular payments from their account such as a monthly direct debit, where the bank will ask for the consumer to approve the payment before it’s approved and sent.

These two safeguards will come into force by 2020.

The proposed change comes after some £755m ($966m) was stolen from UK bank accounts last year from “technology savvy” cyber criminals, according to the FT.

“This is just the start, the ambitious reforms should make it far less likely you’ll be hit with hefty fees for missed payments, much easier for you to stay informed about where your cash is going, safer for you to bank online and simpler for you to change account,” said Hannah Maundrell, the editor in chief of Money.co.uk to the BBC

It comes as no surprise, as contactless spending in the UK has surpassed $2bn per month in July this year, and increased security measures have been a factor of improving contactless sales in the UK.

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