Pay with a Selfie: How Safe Are the New Ways to Pay?

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In 2016, more than half of all purchases in the U.S. were made online instead of at a brick-and-mortar store. From selfie-payments to Facebook Messenger bots, there is now a long list of unusual ways that you can pay the water bill or complete your grocery run for the week.

But how safe are these new ways to pay? Let's take a closer look at how some of these new payment methods work, and what you can do to make them even safer.

1. Facebook Messenger Bots

Colorado-based fintech company BillHero was the first to leverage a Facebook Messenger chat bot to pay bills via chat commands. Later on in September 2016, Facebook enabled all of the 34,000 plus developers on the platform to support payments. The social media giant is working with several players in the credit card industry and fintech, including Visa and Braintree, to process all types of payment options.

By opening the gates, Facebook allowed U.S. customers to complete a wide range of other transactions and purchases on Facebook Messenger. In a nutshell: The chat bot lets you know about a product that you might be interested in, and provides a "buy now" button. When you click it, it takes you to a checkout screen with your shipping information and payment method for you to review. Boom! Just like that, you're ready to pay.

But Is It Safe?

Well, Facebook Messenger payment bots are covered by the same level of security as all other Facebook products. All transactions using a Facebook chat bot are encrypted or processed through a trusted third-party payment processor, such as PayPal or Stripe, to protect your payment information, such as your card number or CVV. Also, transaction confirmations from a bot will restrict your information, such as only showing the last four digits of your credit card number.

How to Make It Safer

Your first line of defense starts with your Facebook password. Facebook recommends building a password that has at least six characters and is a complex combination of numbers, letters, and punctuation marks. When a password isn't strong enough, the app will let you know. Also, make your Facebook password different from those you use for your online banking, investing, or retirement savings accounts. (See also: 3 Sneaky Ways Identity Thieves Can Access Your Data)

A second tactic is to turn on login alerts so that you receive an automated alert when someone tries logging in to your Facebook account from an unrecognized device or browser. A third is to require a password or PIN whenever sending money or making payments in Facebook Messenger.

2. MasterCard Selfie Payments

Speaking of passwords, MasterCard believes that they cause too much hassle and presents the option to pay with a selfie. The "selfie pay" technology was first tested in the Netherlands, the U.S., and Canada and will be rolled out gradually across the world throughout 2017.

Through a smartphone app, shoppers can confirm a purchase by taking a selfie and letting the facial recognition software verify their identity. According to MasterCard, 71% of users rated "selfie pay" highly during trials.

But Is It Safe?

To prevent somebody from just holding up a picture of you and getting away with a $1,000 shopping spree, the app requires you to snap the picture after you blink or shake your head. Then, the app compares the selfie with stored algorithms of your face to identify you. During the trials, 73% of users believed that "selfie pay" will reduce fraud and 90% of them would use it in the future.

How to Make It Safer

Since "selfie pay" is still in the process of being rolled out, there's little that we can do as of right now. If taking selfies isn't your cup of tea, MasterCard also plans to provide a fingerprint confirmation option with the app and is currently testing voice and cardiac rhythm recognition.

3. Amazon Dash Buttons

Connected to your home's Wi-Fi, the Amazon Dash Button allows you to reorder many of your favorite products with a simple click. To set up each Amazon Dash Button, you'll need to download the Amazon app on your Android or Apple device, connect the Dash Button to Bluetooth, and also enter your Wi-Fi information. Some Dash Buttons don't support Bluetooth connection, and use your smartphone's Wi-Fi connection or speakers instead.

Currently, the button is only available for Amazon Prime members, costs $4.99, and provides you with a $4.99 credit after your first order. There are hundreds of products to choose from including Charmin, Doritos, Greenies Dog Treats, and Red Bull! Once you click the button, an indicator light will turn green when your order is successfully placed, or red if there was a problem.

But Is It Safe?

A device that connects seamlessly to your Wi-Fi, smartphone, and Amazon account — what could go wrong? While there are plenty of folks that have hacked their own button to do anything from turning on lamps remotely to ordering pizza with one click, there are currently no reports of malicious hackers tapping into another person's Amazon Dash Buttons.

How to Make It Safer

Turn on the "order protection" feature on your Dash Button to prevent a new order from being placed until your prior order is delivered. This way you can prevent your spouse or son from tripling an order of detergent on the same day.

Consider turning on the email notifications of your Amazon orders so that you can cancel any orders that you don't recognize.

And it should go without saying, but set a strong password for your Wi-Fi and update that password at least once a year.

4. Chip Cards

No other new form of payment has generated more discontent from American consumers. From the confusion about swiping or inserting, to the awkward conversation with cashiers while waiting for your card to be processed, there is a list of reasons these metallic chips are considered an annoyance by many.

However, the reality is that chip cards are far from being a new way to pay. They have been reducing fraud in over 130 nations around the world for several years. So, the U.S. is just playing catch-up. As of April 2016, Visa had issued roughly 265 million U.S. chip-enabled credit and debit cards, and MasterCard had upgraded about 70% of its U.S. debit and credit cards to the chip format.

But Is It Safe?

The evidence clearly indicates that chip-enabled cards reduce fraud. Visa has reported that among the U.S. merchants who were suffering the most instances of card fraud at the end of 2014, those that began accepting chip debit and credit cards saw instances of card fraud fall 18.3% as of the fourth quarter of 2015. On the other hand, some of the U.S. merchants who opted not to upgrade payment terminals to process chip cards experienced an increase in instances of card fraud of 11.4% for the same period. (See also: 4 Ways Chip Credit Cards Make Life Easier)

How to Make It Safer

Simple: Opt to use your chip-enabled cards over those without a chip, and choose merchants with chip-enabled payment terminals over those who are still holding out. As with everything else, strength comes in numbers. Only when chip cards have become the norm across the nation can we all reap the enhanced security benefits of chip technology.

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