33 states ask feds for consumer protections with mobile-pay apps

With more than two billion people worldwide using mobile-pay apps to send money around, the federal government is examining the security of those transactions.

There is a lot of money at stake using your phone to buy and sell. Mobile-pay revenue was projected to hit $1.7 trillion in 2021, leaving little wonder there is a growing concern to ensure the money goes where it's intended.


The Consumer Financial Protection Bureau wants information from tech companies that operate mobile-pay systems in the U.S. The government wants to better understand how firms, like Amazon, Apple, Facebook, Google, PayPal, and Square use personal payment data so that consumers can be protected.

In late December, the attorneys general from 33 states, not including Texas, called for stronger consumer safeguards for money sharing platforms and apps.

Houston tech expert Juan Guevara Torres is not surprised by the conversation.

"Technology will always be ahead of legislation," he says while noting the apps are convenient but imperfect.

The state attorneys general are encouraging the government to address three major issues: customer service, account access, and third-party scams.


On Facebook, which has its own feature to send money to someone, most who responded to a question about using mobile-pay said they had few problems. There were a few, though, who had troubling experiences.

Vannessa Wade says, "When people don't know how to work it or give the wrong address or there's a tech blip, it can be a headache."

To that Guevara Torres says "The technology did what it's supposed to do: initiate a transfer from account A to account B. The technology worked, but the human factor didn't."

That human factor is at the center of the inquiry: to minimize mistakes, address complaints, and weed out scammers. It's part of the evolution of a 'convenience' that is still relatively young.

"You can plan for a lot of scenarios but unless you use the technology, you will not find out where the weak points are," says Guevara Torres.

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Until the government completes its investigation, there are some things to challenge fraudulent mobile-pay transactions.

Start with reporting to the company that runs the app and ask them to reverse the payment. If you've linked the app to a credit or debit card, report the fraud t the card company and ask them if they can reverse the charge.