January 2012

The ABCs of E-Payments

The Internet has brought about a world of convenience. You can chat with people from around the world; search and apply for jobs; and, of course, purchase goods and services with just a few clicks of the mouse. As the popularity of purchasing goods and services online continues to grow, so too do the number of methods people are using to pay for them. Though debit and credit cards are still the most popular types of electronic payments, or e-payments, other payment methods have been developed:
 
  • Electronic money (e-money): You can’t go into a pharmacy or retailer today without noticing gift cards, which can be used online. These gift cards are examples of e-money. Another type of card is a stored-value card. These types of transactions are common with public transportation passes or telephone cards. Note that some stored-value cards can be “reloaded” at cash machines or by the merchants, while others are simply thrown away after their use. Some of these cards may also be “smart cards,” which means you can use them as either credit cards or debit cards.
  • E-wallets: According to the FTC, “some Internet-based payment systems allow value to be transmitted through computers.” These are called e-wallets and are usually for making small online purchases, such as coffee or magazines. Transactions made with e-wallets may be accessed via stored value or through an online account.
Protect yourself
 
As with any type of electronic banking, it’s important to take steps to ensure that your money and your personal information are protected. The FTC offers these tips:
  • Deal with businesses you know and trust: And make sure you’re entering personal or financial information where it should be – on an order form.
  • Read the merchant’s privacy policy before you make any payment: This will help you determine what information they will need and how it will be shared with others. If you are uncomfortable with a policy, don’t make the purchase.
  • Guard your personal information: Be careful when giving out your address, telephone number, Social Security number, account number or e-mail addresses. Remember that some scam artists may pose as merchants you do business with and ask for this information online. Before giving out information, contact the merchant by phone or via the website to verify that the merchant is requesting your information.
  • Check your browser: Is your computer’s Internet browser, which encrypts information you send over the Internet, up to date? Be sure to check with the creator of the browser and download the latest version. Also, every time you purchase something online, watch for the lock symbol and the letters “https” in the URL of the website. These show that you have a secure connection.
  • Read the fine print regarding returns and shipping: This type of information should be available on the merchant’s website.
  • Never give out your password to anyone online: Also don’t choose passwords that are easy to guess, such as your address or phone number.
  • Do not download files from strangers or click hyperlinks: These may contain viruses or programs that capture information in your computer.
  • Watch your account activity: By monitoring your accounts, you’ll be able to detect fraud. If you notice an unauthorized transaction, report it immediately. And if your card is stolen, report it immediately.
Know your rights
According to the FTC, the Fair Credit Billing Act (FCBA) and Electronic Fund Transfer Act (EFTA) offer protection from the following:
  • Charges or transfers that you or anyone authorized to use your account have not made
  • Charges or transfers that are improperly defined or have the wrong purchase amount or date
  • Mathematical or similar errors
  • A creditor’s failure to properly reflect payments, credits or electronic fund transfers
  • A creditor’s failure to deliver credit billing statements to your current address, provided you sent written notice of your address 20 days before the billing period ended
  • Credit charges or electronic fund transfers for which you have requested an explanation or documentation due to possible error
Learn more
If you have any questions about your account activity or making online payments and purchases, give us call – we’d be happy to help.