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Posted on January 24, 2016 by in Identity & Privacy, Personal

Thanks to services like Apple Pay and innovations like EMV chips in credit cards, you likely have more payment options than space in your wallet (or in your smartphone). But having ample choices doesn’t necessarily translate into better security.

When it comes to secure payment methods, it’s worth knowing the pros and cons of each, so you can make an informed decision. With that in mind, here’s a look at the top options and what you need to know for payment security.

Digital Wallets

Mobile payment apps are designed to free you from cash and credit cards by storing your information securely. You access the data by swiping your smartphone over a checkout reader or by keying in a password that lets you unlock credit and bank account numbers.

Pros: Vendors like PayPal, Google Wallet, Venmo and others are highly sensitive to payment security concerns, so they’re building in robust controls to keep information safe. If you also employ mobile device security, digital wallets can be safer than credit cards tucked into a traditional wallet or billfold.

Cons: Mobile payment technology that collects all of a user’s financial data in one place seems too tempting for hackers to pass up. That’s likely why only two percent of Americans use digital wallets. Without more widespread adoption, security enhancements will likely take longer to arrive.

EMV-Enabled Credit Cards

Also called “chip and PIN” or “chip and signature” cards, these new smart credit cards are designed to be more secure than traditional cards that require only a user’s signature.

Pros: These cards have an integrated chip that creates a new authentication code for every transaction, so it adds an additional layer of payment security. Also, the cards can’t be “cloned,” which is a hacker’s way of stealing information from a traditional card’s magnetic strip and making a new card.

Cons: Even though many retailers have readers that can accept these cards, not every restaurant, shop, and venue has the technology to read them. You can still use the cards by giving your signature, but you’ll miss out on the extra security the chips provide.

Bank Checks

With online banking, many people write only a few checks per year, and that may be a good thing. Banks are attempting to put more payment security controls in place, but check scams are still far too common.

Pros: For one-time payments (magazine subscriptions, charity donations, or monetary wedding gifts), checks can be a convenient payment method.

Cons: Checks not only feature your name and address, but also your bank account and bank routing numbers. Worse, they give identity thieves an example of your signature. Because of this, you should send checks only to people or companies you trust, and regularly review your bank transactions to look for fraudulent check amounts.


The use of good ol’ currency is starting to seem like a thing of the past. Even small transactions, like buying a newspaper or a cup of coffee, can be done with a swipe of a smartphone. But don’t ditch the paper money quite yet.

Pros: As easy as it is to swipe a card everywhere you go, security concerns will go along with you. That’s why it makes sense to pay with cash whenever possible, especially for smaller transactions. Cash carries zero risk of identity theft.

Cons: No one feels particularly safe carrying a large amount of cash, and if that money is lost or stolen, it’s gone — unlike credit or bank cards, which can be replaced.

In general, every form of payment has its risks, and it can be tricky to keep payment security in mind when you’re running errands or trying to speed through online ordering. But to increase protection and minimize the chances of identity theft, it pays to focus on security during any transaction.