Businesses need to be able to provide their customers peace of mind that the payment methods they are using are safe.
Fraud is a top concern for many businesses, understandably, as it can be costly to the company and negatively impact their reputation and level of trust with customers.
As we discussed in our article “Is Open Banking Safe?”, Open Banking has security at its core and can in fact improve protection against payment fraud. Here we explain 5 ways Open Banking makes taking payments safer.
With Open Banking there is no middleman as customers pay businesses for their goods or services directly from their bank and therefore 0% risk of fraud. This makes it safer for customers as they do not need to be worried about their money and businesses have the reassurance that they will not be hit by any chargebacks due to fraud or payment issues later down the line.
Less Threat of Theft
Consumers are used to purchasing online and whilst it is in general a safe practice, entering card details always involves an element of risk, especially if the card details or passwords are saved onto the computer. Unlike Open Banking, card payments do not require extensive authentication or verification to confirm that the user is who they say they are, leaving them in a vulnerable position.
No Need to Share Personal Information
As Open Banking payments work directly with the customer’s bank, there is no need for customers to share additional personal information when making a payment. This is ideal for online checkouts as it also makes the process quicker.
Use of Mobile
One of the benefits of Open Banking is the ability for customers to use their mobile phones to make payments. Not only is this convenient, but it also means customers have additional layers of protection with additional pin codes or biometric locks and no need to carry cards. Whilst traditional contactless payments via mobiles can be vulnerable to NFC (near field communication) fraud, the risk of this happening with Open Banking is eliminated by using secure bank transfers for all transactions.
No Need for Software
Open Banking can use QR codes or PayLinks helps to make the payment process quick and easy but safe at the same time. Users simply need to scan and pay and is all within the mobile browser so know specific software is needed. Not having to download additional software makes it safer for consumers and less of a hassle.
Customers need to know that purchasing from a business is as safe as possible. Businesses also need to know that the payment methods they accept protect them and the consumer. Open Banking can provide this peace of mind to both parties. Less risk of information being stolen than credit or debit card use and payments made directly from banks, and avoiding any additional parties are just some of the ways open banking makes taking payments safer.