Is Mobile Banking Secure?

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Chase Online and Chase Mobile uses encryption technology and established user IDs and passwords are necessary to access account information, the bank says. Images do not reside on the mobile device, which helps protect personal information in case of theft.

Dwolla is a payments service competing with MasterCard and Visa's credit card networks and online and mobile payment systems like PayPal and Square, charge a percentage each time you make a transaction plus a small flat fee.

With Dwolla, you pay a flat 25 cents a transaction if you receive a payment, with no fees based on percentage. Users can go online and make payments or use an app on their iPhone or Android device. The company is also working to have retailers accept Dwolla payments in stores, with business owners in Des Moines leading the way. PayPal users pay a 2.9 percent transaction fee plus 30 cents to accept payments. Square, launched by Twitter co-founder Jack Dorsey, charges 2.75 percent when you swipe a card on the device. If you enter a credit card manually, your cost is 3.5 percent of the fund amount plus a 15-cent transaction fee.

Visa and MasterCard banks charge merchants an average credit card interchange fee of around 2 percent per transaction, according to the National Retail Federation.

Ben Milne, founder and CEO, said Dwolla has similar policies and procedures as banks. But he said Dwolla's role in the discussion of errors in mobile banking isn't so much about the policies and procedures but how his startup of a dozen people "handles these situations on a user level, both proactively and retroactively."

"Dwolla is a relatively new network with big aspirations, but trust must come before growth," he said. "As it should, this puts a lot of responsibility on Dwolla to proactively craft new technologies that put an emphasis on product scalability and a pleasant user experience. From there, it's about user engagement. How did we do? Tell us what sucks? Are creating a network that makes you happy? What can we do to make this a better product for you? And because we're a nimble tech focused startup, we can move at a pace that meets the expectation of the 21st century consumer."

Another service, Boom, allows is a mobile banking service through texting even without a smartphone for a "branchless" banking model.

Pete Kelly, vice president of business development with m-Via, the company that offers Boom, said Boom is competing with cash.

The company's target market is the "unbanked," or those without access to traditional banking services, which is about 80 percent of the global market. To serve that market, Kelly said the company was founded on the principles of security. He said that market is mostly migrants and those who chose not to be in the banking system.

"We're not just a money transfer provider," he said. "We're a mobile global bank."

Boom users pay an annual membership fee and a flat fee of $2 each time you load money into your account. You can join at a participating 7-Eleven convenience store, request one by phone or fill out an online form.

Users can deposit money at a 7-Eleven then send a text message to send money to a recipient, who will also be notified about the transaction via text.

Kelly said there is always a live operator to help via telephone and the service is easy and fast.

"It's certainly easier and faster than existing money transfer companies," Kelly said. "We're all about empowerment and so forth. The level of service we provide is better than anything offered."

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