How to protect yourself on payment apps

In many cases, you cannot get your money back if you made a mistake in peer-to-peer payments. But there is something simple you can do to protect yourself.

DALLAS – It’s bad enough to send a prominent work email, text or message to the wrong recipient. But have you ever sent money to the wrong person? Or sent the wrong amount of money to the right person?

There are many platforms where this can happen, including PayPal, Apple Pay, Venmo, Zelle, and Google Pay, among others. They are known as peer-to-peer or P2P payment services.

A recent survey by LendingTree estimates that 84% of us transacted this way and 23% of us sent money to the wrong person using P2P payments.

What’s more, they discovered that 15% of us have been scammed for sending someone money this way. And the percentages of mistakenly sending a P2P payment to the wrong person and scamming a P2P payment jump to 42% and 22%, respectively, for people who use P2P services several times a week.

The problem is that many people have their peer-to-peer payment accounts tied directly to real money. Once you hit send, that real money is no longer yours…even if you mistakenly sent it to the wrong person or accidentally typed in $500 instead of $5.00.

Consider linking your account to a credit card instead of cash

If you still want to send P2P (peer-to-peer) money but are really worried about all the R4E (margin of error), then some advise you to link your account to a credit card at instead of a debit card.

Some of the major platforms will not accept a credit card as a payment instrument on your account. And those who accept a credit card will often charge you a transaction fee of around 3%. But with a credit card, you are protected by Regulation E.

As Consumer Reports explains, this provision protects you from liability for any payment over $50 “in the event of fraud or payment made in error.” But you must generally notify the financial institution within two business days of a problem payment to benefit from this protection.

What if you sent money to the wrong person or sent the wrong amount?

Experts advise only paying people you know through peer-to-peer payment systems. If your P2P account is associated with your money and you make a mistake, most payment services suggest that you contact the person you sent to by mistake and ask them to return the money.

Some of them will reverse a payment if the person you sent it to doesn’t claim it within a certain time. And in some cases, some peer-to-peer payment services ask you to contact them to help you sort out these issues.

Here are the policies of some of the major platforms:

Additionally, you may be able to file a formal complaint with the Consumer Financial Protection Bureau.

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