The risks of mobile payment solutions and how to mitigate them

International Security Journal receives exclusive insights from Devin Partida, Editor-in-Chief, ReHack, on mitigating the risks associated with mobile payment solutions.

Mobile payment options have expanded to accommodate increased demand for convenient mobile shopping.

However, the expansion of these systems has introduced some unique cybersecurity vulnerabilities.

What are they and how can digital storefronts stay safe?

Key risks in mobile shopping platforms

Cybercriminals pose challenges to all digital platforms, but some are more specific to mobile payment systems.

Here are the high-risk cyberattacks store managers must prevent most on mobile shopping platforms.

Bypassed authentication measures

Most payment platforms require several identity verification measures, including PINs, passwords and biometrics.

Hackers bypass these to get access to mobile payment accounts. These can also lead to stolen credentials, locking consumers out of their accounts.

Man-in-the-middle (MitM) attacks to intercept data

MitM attacks intercept transmissions between a shopper’s phone and the payment platform. It is like a digital form of eavesdropping.

The criminal can capture credit card or login info while the information is in transit. The simplest way to do this is by setting up fake Wi-Fi signals.

When unsuspecting consumers connect to unprotected networks, the hacker can manipulate how information moves through them.

Fraudulent transactions

After the threat actor has the information they want, they can use the mobile payment platform to make unauthorised transactions and move money around.

Methods to keep mobile cybersecurity concerns at bay

Several defensive strategies are designed to prevent unauthorised access and hide someone’s online activity.

These are the best ways to discourage attack attempts while keeping the checkout process easy for customers.

Fraud detection systems

Experts protecting e-commerce need oversight over payment systems.

Any supplement to manual intervention is welcome, which is why real-time monitoring and fraud detection are so powerful.

These automatically discover anomalies and assign risk to each potential threat.

The data helps analysts understand the website’s unique threat landscape and how to curate protections.

Secure API implementation

APIs allow websites to communicate quickly with connected systems, like third-party payment platforms and banks.

These interfaces need to be as secure as native hardware. Professionals should start by defending their authentication and payment gateway APIs.

Tokenisation

Tokenisation manipulates and replaces sensitive data to prevent hackers from seeing genuine sensitive information.

If criminals access a credit card number’s token, they must use a decryption method or key to uncover it.

Encryption

Encryption takes many forms, but end-to-end setups protect payment systems from the shopping cart to the confirmation screen.

This gives security to a mobile device regardless of the payment platform’s server and the device’s location.

Robust authentication

In 2023, PayPal had to discover why thousands of accounts were unexpectedly accessed.

Ultimately, weak passwords were the cause. The incident proves multifactor authentication must be required for all payment platforms.

Some websites require login credentials in addition to another verification method, and users could have the option to set up another step, including:

• Sending one-time codes to approved emails and phone numbers
• Using biometrics such as fingerprint or face-scanning
• Assigning a PIN
• Integrating an account with an authentication app

Compliance requirements to consider

If shops want to leverage mobile payment options, they must follow rules in multiple jurisdictions. Some are national, while others apply globally.

General compliances include National Automated Clearing House Association rules and Payment Card Industry standards.

These organisations tell companies how to obtain and store consumer information in a way that maintains user trust.

Requirements vary based on the site’s customer base. The most important guidelines include but are not limited to:

• Payment Card Industry Data Security Standard: Sets rules for how sites save cardholder information
• General Data Protection Regulation: Requires businesses in the European Union to be transparent about data collection, usage and processing
• California Consumer Privacy Act: Allows Californian citizens to have more extensive rights over personal information handling and deletion
• Personal Information Protection and Electronic Documents Act: Governs Canadian data by enforcing data safeguards and accountability

There are also many financial regulatory guidelines based on the mobile payment method. Electronic funds transfers require particular safety measures and e-commerce sites should also incorporate anti-money laundering protocols to find and isolate malicious financial activity.

The way to safer mobile payment structures

Knowing the most significant threats in this landscape can help businesses construct solid defenses.

Proactive cybersecurity measures require platforms to make the purchasing experience convenient while remaining secure.

If organisations achieve this balance, they will comply with international regulations while protecting their reputation.