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I was wondering if anyone knows of any inherent security risk(s) to using Electronic Wallets, such as Android Pay, Apple Pay, Samsung Pay, etc, where it would put the individuals money at risk?

I am not entirely sure if ANY card can be used with these services, or just those institutions who have made accommodations for it; so the question applies to the security of your funds using them - in either case.

Of course this is just the financial side of it, not concerning the obvious hardware hacks that can be applied to the NFC sensors to hijack the information from the device, the question is whether the information (however obtained, be it at the POS or via a hardware hack) can be reasonably used to compromise one's money? If its a credit card, you have a liability filter, but if say you have loaded a debit card, the money is gone until you find a way to get it back.

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These are services that facilitate using credit cards. So whatever vulnerabilities there may be, your risk is limited to your liability to the credit card issuer.

Usually, this means no liability whatsoever, and the most significant risk is the inconvenience of re-issuing the compromised card. Some card issuers separate the "Pay" service account from your main account so that even that risk is mitigated - the number exposed is only used for that specific service and doesn't compromise your actual physical card.

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  • Ok good to know, thank you. I know for example some people who use their debit cards this way, so I was wondering how secure that can be. Credit cards, I figured as much, no matter what you are fairly safe for the most part. But I was wondering about more "tangible" assets, can they be used this way, like bank accounts or mostly likely debit cards? And if so, how are they protected I wonder.
    – GµårÐïåñ
    Oct 26, 2015 at 3:38
  • @GµårÐïåñ unless you type your pin, your debit card is used as "credit with immediate charge" and under the same rules. I'm not familiar with the ability to use bank accounts with these services, but if there's - that would be similar to ACH transactions liability. Generally, in the US it is the safest to only use credit cards as charge cads.
    – littleadv
    Oct 26, 2015 at 3:42
  • Correct, I know that. But none the less, it WILL deduct that amount as untouchable and you can't dispute the charges like you would a credit card. For a credit card, you get a hold and then you can get it expired, but with debit, if you use a pin, its gone immediately, but if you use it as a credit, it will take some time to clear but for all intents and purposes that hold means you don't have access to the cash. Hence why people shouldn't use debit cards for renting cars.
    – GµårÐïåñ
    Oct 26, 2015 at 3:45
  • That's how debit cards work, there's nothing special about using the wallet apps with that regard. As I said, in the US the safest is to only use credit cards.
    – littleadv
    Oct 26, 2015 at 3:51
  • True, just wondering if there are special mitigation or not when using electronic wallets, but apparently they are for all intents and purposes treated the same way as if you used a physical card or someone used your card number. Thanks for the discussion, appreciate it. I get a lot of questions and while I know a decent amount about it, wanted to solicit a broader knowledge/experience on it to help fill in any information gap. My knowledge on it is mostly on the technical/hardware/encryption side and not so much on actual "financial side" of the equation.
    – GµårÐïåñ
    Oct 26, 2015 at 18:17

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