Milk packets are being washed in soap and water, we’re sanitizing our hands about 20 times a day, buying fresh vegetables is the day’s highlight - never before have we put so much thought into the mundane activities of life. While the COVID-19 pandemic has made people stay at home, buying and selling of essential commodities have continued, albeit with a difference.
Instead of going to the market, we’re more dependent on shopping online and having goods delivered to the house. When it comes to paying for these goods, digital payment is becoming the most popular transaction mode. According to one report, the number of digital payment platform downloads has almost doubled in India since the lockdown was initiated.
Why is Digital Payment better during the Lockdown?
Making payments digitally through phone wallets, debit/ credit cards and net banking is being preferred not just because it’s convenient but also because it is being seen as the safer mode for transferring funds.
· It enables social distancing
Making digital payments reduces the need to come close to another person and thus helps maintain the social distancing protocols. In fact, many e-commerce apps and websites have done away with the ‘cash on delivery’ option for now.
· It reduces the need to visit ATMs and banks
Transferring funds digitally reduces the need for physical cash and, in turn, trips to the banks and ATMs. This helps people stay safe at home without having to compromise on the things they need to buy.
· Currency notes may be potential carriers
Since the COVID-19 virus spreads from person to person through contact, currency notes may be a potential carrier. Making digital payments reduces the number of things that must be touched while making a purchase and helps keep people safer. You can wash your fruits and vegetables in soap and water but doing the same with currency notes can damage them.
What Businesses Need to Do to Make Digital Payments Risk-Free
While transferring funds digitally is convenient, the surge in the popularity of digital payments may also increase the risk of fraud and cyber-crime. To protect themselves and their consumers against this, business owners must make every effort towards making digital transactions secure.
Monitor suspicious purchasing behavior
Being able to spot suspicious buying activity can help protect an organization from cyber-crime. For example, if a person makes a large purchase but pays for the same through multiple credit cards, there is a chance of it being a fraudulent transaction. That said, identifying such activities alone are not enough to cancel the transaction and tag it as fraudulent. However, it is enough to trigger the need for further checks.
Phone number validation
A person’s phone number is the most public of all their personal information and yet tied to their digital identity. It is connected to almost all forms of identity proof including Pan Cards, Aadhaar cards, driving licenses and more.
Thus, validating a person’s phone number before a transaction is completed is the easiest way to reduce the risk of fraud. This involves checking that the number submitted actually belongs to the person using it and that the connection is live. Most businesses validate phone numbers by asking consumers to enter a validation code that has been sent through SMS to complete a transaction.
Address Verification System
Address verification is very helpful for business owners wanting to check that a card being used for a purchase is actually owned by the person making the transaction. The system checks the billing address given while making a purchase with the data from the bank. This is based on the assumption that if a stolen is card is being used by a fraudster, he/she will not have access to the correct billing address.
Use Hypertext Transfer Protocol Secure (HTTPS)
Hypertext Transfer Protocol Secure (HTTPS) refers to a more secure version of the usual HTTP internet protocol. It has enhanced security features such as digital signatures, public-key encryption and secure authentication. This is easy to integrate with HTTP and makes financial transactions secure by encrypting the communication.
Maintaining a clean database also plays a role in making digital payments secure. For example, duplicate customer records may make phone and address verification difficult. Improving data quality by standardizing, verifying and de-duplicating customer records should be a perpetual process.
The COVID-19 global pandemic is not just changing the current scenario but will also influence the way business is conducted in the future. People are unlikely to want to step into retail outlets unless necessary for the near future. Digital payments will continue to be seen as the most convenient way to make purchases. Hence, businesses need to look at the long-term picture and make their payment gateways as secure as possible.