Is Your Bank Account Safe?
Most people shop online. Some do occasional shopping while others get everything – from soup to nuts- online. How secure is your personal information?
FORMS OF PAYMENT
DEBIT, CREDIT, CHECK,
PAYPAL OR GOOGLE?
There are many ways to pay online. Some websites offer you the option how to pay, while others mandate only specific forms of payment.
The basic options are:
1. Debit card
2. Credit Card
The advantage of using a debit card is it can be set to only work if there is money in your account. This is a great way not to spend more than what you have.
The disadvantage is if your card information is stolen, your account can be depleted and it will be extremely hard to recover your lost funds.
The advantage of a credit card is that in case the information is stolen, the credit card company has to deal with the stolen money, and not you!
Some sites allow you to enter your bank and routing number and they directly take the money out of your account, as if you wrote them a check.
The easiest way to explain PayPal is that it is an online bank. You set up an account, which links to a real bank account, and you are able to send and receive money online. The advantage to using PayPal over any of the previous mentioned approaches is that PayPal does not let the sellers see any of your payment information. This comes at no cost to the individual, due to the percentages the seller has to pay to accept PayPal customers.
The disadvantage is for sellers, due to the higher merchant fees and that it generally takes several days until the money is deposited into a real bank account, which must be transferred manually.
WEBSITES ACCEPTING PAYMENTS
A website can accept payments two different ways:
1. Online merchant services
2. PayPal or Google
ONLINE MERCHANT SERVICES:
Online merchant services are similar to a physical terminal,like in the supermarket, where you swipe your credit card in the supermarket.
It is different than a physical terminal in that it is connected to the Internet. Therefore, there needs to be extra security measures in place.
PayPal and Google Wallet allow a customer to pay without revealing payment information to the business. They pay simply by logging into their PayPal or Google account and accept to send money to the website.
ON THE BUSINESS’S END:
A business can choose which method of payment they prefer.
By using a merchant services account, they are able to manage their physical and virtual terminals together in one plan. The advantage is it is organized more efficiently. The money which comes in goes directly into your account, there is more flexibility in the setup, and the design will match seamlessly with the rest of the website.
The disadvantage of using the same merchant service account as your physical terminal is the need to be PCI compliant ($99 yearly fee). You need to pass the tests to confirm your network is secure, as well as purchasing a secure link (“e.g. https.”)
PayPal is a simpler setup, with no programming needed, no need to worry about PCI compliance, and no monthly fees. However, the percentages per swipe are generally slightly higher than standard merchant services and the customer is directed to PayPal’s site to make the payment.
What should a customer look out for?
– If the website is using a standard merchant service account, you should make sure the website link begins with HTTPS (the “s” refers to a secure link).
– If the site looks fishy, perhaps it’s a phishing site!