‘Your Wallet’: Experts say ‘tread carefully’ when sending money on payment apps

LINCOLN, Neb. (KLKN) – Payment apps like Venmo and Cashapp are an easy way to quickly transfer money without cash.

But Josh Planos with the Better Business Bureau said there can be a big risk to using these apps, especially when sending money to someone you don’t know.

“Tread carefully,” he said. “I personally would only use these payment methods within my own family, and certainly not with a stranger.”

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Planos said the BBB has seen a large increase in scams on these payment apps, especially among young people.

“It’s a very useful tool from a scammer’s perspective,” he said. “Once that money is spent, you have very little opportunity to get that money back again, so ultimately the liability is yours.”

One common hoax they see is buying tickets online and never getting them – because the tickets weren’t even real.

“Unfortunately, we’ve seen cases locally with things like the Morgan Wallen concert, with things like Husker sporting events,” Planos said. “In a bind, when you have limited options, folks will turn to areas of the internet or forms of payment that they otherwise wouldn’t, and you start to let your guard down.”

SEE ALSO: Scammers try to score by selling fake Husker football tickets, Nebraska AG warns

If you are going to use a payment app, he said Venmo or Paypal are likely the safest.

Richard Baier, president and CEO of the Nebraska Bankers Association, said while it’s largely up to individuals to protect their own money, many banks are working on ways to prevent fraud through these apps.

“We’ve invested hundreds of millions of dollars in technology,” he said. “And behind the scenes, we’re building new AI tools that help try to identify potentially fraudulent activity.”

Baier said depending on the app, some banks can limit the amount of money that can be transferred.

SEE ALSO: ‘Your Wallet’: How you can save on Husker game day costs in Lincoln

This is the first year that all high school students across Nebraska will have to take a semester of personal finance before graduating.

Baier said as kids get older and head to college, it’s especially important that they learn to be safe with their money.

For University of Nebraska-Lincoln students, he recommends going to the Union Bank & Trust on campus. They can set up a student account and get other resources to help them manage their money.

SEE ALSO: ‘Your Wallet’: Savings program improves the financial future of Nebraska students

“Check your bank accounts and your records routinely,” Baier said. “I log into mine every morning to make sure there’s not been any fraud overnight.”

He said if you do see something wrong, reach out to your financial institution right away to cut off the fraud before it becomes a major problem.

Both organizations say it’s best to use two-factor authentication whenever possible.

Another piece of advice: Never let money accumulate in the app. Instead, put it in a bank account or safe location right away after a transfer.

Editor’s note: This report is part of a weekly series Channel 8 is airing called “Your Wallet.”  We’ll be looking into topics that deal with your money. The reports air every Monday during the Channel 8 News at 6 p.m.

Categories: Money, News, Top Stories