Protect Your Digital Wallet: The Ideal Security Practices for 2025
Over the past ten years, one of the biggest developments in both fintech and retail has undoubtedly been the rise of the digital wallet, otherwise known as an e-wallet. It made transactions so much more convenient and secure (not to mention quicker). In fact, Apple Pay and Google Pay have become so popular as payment methods, especially with younger generations, that many people can no longer remember their PIN!
In this guide, we’ll help you understand everything there is to know about your digital wallet, including potential threats and best practices to protect your finances, such as credit monitoring. Since many transactions take place online nowadays, protecting financial data and ensuring digital security is more important than ever.
What Is A Digital Wallet?
A digital wallet allows you to make transactions electronically without needing your physical bank card. It links to your bank accounts or cards, making transactions a breeze with a quick tap or scan.
Popular examples of digital wallets include Google Pay, Apple Pay, and Samsung Pay. A study in 2023 found that there were 3.6 billion digital wallet users globally, with an estimated 60% of the world’s population opting to go digital with their payments by 2026.
Benefits Of Using Digital Wallets
Speed
Digital wallets make everything so much quicker with just a quick tap. Even when shopping online, digital wallets often fill out your information automatically. And splitting bills or transferring funds is super quick, too.
Convenience
As if speedy transactions weren’t enough, digital wallets are so much more convenient. Gone are the days of needing to carry cash, bank cards, and a wallet. You have fewer things to worry about misplacing as everything is stored on your smartphone.
Enhanced security
Facial recognition and fingerprint scanning add a new layer of security when it comes to protecting your finances. Digital wallets also encrypt payment information, meaning your card details aren’t shared with anyone who doesn’t need them.
Evolving security threats targeting digital wallets
Unfortunately, as with everything online, digital wallets aren’t without their risks. Cybercriminals are always finding more and more sophisticated ways of targeting vulnerable people. It was only a matter of time before they tapped into e-wallets (pun intended). Some of the most common risks when it comes to using digital wallets include:
- Phishing scams
- Malware
- Unauthorized transactions
- Public Wi-Fi
How To Keep Online Transactions Secure
Create strong passwords and enable biometric authentication
Get creative with passwords, and don’t use something that can easily be guessed. Also, be sure to enable biometric authentication (fingerprint scanning and facial recognition) for an added layer of security.
Avoid Using Digital Wallets When Connected To Public Wi-Fi
Cybercriminals can access data using public Wi-Fi, so avoid making any transactions if you’re connected to an unsecure network. The best thing to do is download a VPN or only use a private and secure network if you’re out and about and in need of internet access.
Keep track of all transactions and monitor them regularly
Digital wallets make tracking all transactions fairly straightforward. You can see exactly how much you’ve spent and where. Credit monitoring is also a handy way of keeping on top of your finances because it can help you detect any fraudulent or suspicious activity.
Disable accounts if you lose your device
If you lose your device, be sure to disable all accounts linked to your digital wallet because you wouldn’t want them to fall into the wrong hands!
How To Detect And Prevent Fraudulent Activity
Credit monitoring is a great way to spot suspicious activity on your account because it tracks changes in your spending habits and notifies you of potential fraud. For instance, credit monitoring can protect you against identity theft if your personal info gets stolen.
While it’s primarily used to protect against someone stealing your identity, this service can also track your credit file and report. A credit monitoring service will notify you whether an account has been created without your knowledge or if a huge purchase has been made.
Your bank may offer you a credit monitoring service for free as a loyal customer, so check in with them and see your options. Other service providers may also provide credit monitoring free of charge, while others may vary in price depending on your needs.
Paid services can offer a much more detailed insight into your spending habits, which can be particularly helpful for digital wallet users. It’s so easy to lose track of what transactions we’re making due to how simple it is to pay!
