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Money Transfer Apps: 5 Scams to Watch Out For

The use of money transfer apps has steadily been growing as a fast and convenient way to send money to family, friends, colleagues, etc., with more than 70% of Americans using them in 2020. Plus, many of these apps are compatible with banking accounts, making transfers even easier. Unfortunately, these payment apps come with serious limitations, and since scammers have been wiggling freely through these loopholes, your hard-earned money could be at risk. Keep reading to learn more about measures you can take to protect your money and the most common money transfer scams to watch out for.  

What is a P2P payment app?

Money transfer apps, also called peer-to-peer (P2P) payment apps, allow you to send money quickly to other people on your smartphone, desktop, or computer. Some examples of P2P payment apps include Zelle​®, Google Pay™, PayPal®, Apple Cash, and Samsung Pay®. Most P2P payment apps allow you to add your bank account, debit card, or credit card. With most of these apps, it’s free to send others money, but some may charge a fee to process payments or for instant transfers.

Why use a P2P payment app?

P2P payment apps offer an effortless way to pay pet/babysitters, split the tab among friends at a restaurant, or gift money to others. You don’t have to worry about rustling together coins and cash or remembering to give them money later. Most of these apps will even do the math for you (phew), and you can make payments within seconds. 

Can you cancel a P2P payment or get your money back?

It’s best to think of sending and receiving money with P2P payment apps like you’re exchanging cash. Once you’ve entered your recipient’s contact details and sent them money, you cannot cancel the payment. (With Zelle®, you can only cancel a payment if the recipient hasn’t enrolled yet). Every time you send money on a P2P payment app, you’re undergoing the risk of never getting your money back from the bank, recipient, or app provider—even if you accidentally sent it to the wrong person. 

Let’s say John received a request from his sister Susie on Facebook Messenger to send him money because her flight was canceled, and she needs to buy a new ticket. John then sends her some money with a P2P payment app. But then, he finds out that someone had hacked into Susie’s account, and he actually sent money to a scammer. It’s highly unlikely John will get his hundreds of dollars back even though it was a fraudulent request. This is because he technically authorized the payment.

Are P2P apps safe to use?

The beauty of the majority of these P2P payment apps is that they typically have extra layers of security for entry access, and they encrypt card numbers and transactions. 

Common P2P Payment Scams to Watch Out For

While it’s impossible to mention every type of scam to watch out for, especially as technology continues to evolve and scammers become craftier, these are the most common ones that signal a red flag:

1. Imposters—This is one of the more common types of scams because a way to prey on emotions, such as fear. Scammers may impersonate the following:
  • Friend/family member—saying they’re “stranded abroad” or some other scenario, and they need money urgently via a money transfer app. Impersonating grandchildren is an especially common way fraudsters try to dupe seniors; so make sure your older family members are aware and wary!
  • Distressed victim—pretending to be in an emergency situation and ask to use your phone in person. Once you hand over your phone to them, they’ll access your P2P payment app to transfer funds to themselves.
  • Romantic interests (often through dating sites)—they’ll work to build your trust and then lure you to send money to them through a P2P payment app for an emergency. These types of scammers, along with those who impersonate someone you know, also may try to involve you in a cryptocurrency or pyramid scheme promising that you’ll make a “lucrative investment.”
  • Organizations/banks/tech companies—saying they’re from the fraud department and “noticed an account issue,” or they say they’re from a tech company and “need to fix” something for security purposes. They’ll then go on to say they need to verify your personal and account information, or they’ll ask you to pay yourself. Once you give them that information and your verification code, they’ll use it to create a P2P app in your name and send money to themselves. 
  • Employers—saying they’ll send you a check to buy equipment. Once you’ve deposited the check, they’ll say you need to reimburse the funds only through a payment app. Unfortunately, the check won’t clear and you won’t get your money back because you authorized those payments. 
If you receive any of these types of requests, don’t engage. If they say they’re a friend or family members, reach out to the person through a known contact number and verify their identity first. If you want to make sure a request from an organization is legitimate, call the published phone number for the company or bank (on the back of your card, for instance) to report the request. Don’t ever call a number that is given to you in a phone call, text, or email. 

2. Pet Scams—If you visit Business Bureau’s website (, you’ll find a slew of pet-scam reports where people have lost hundreds of dollars to fraudsters on P2P payment apps. So-called pet sellers online may appear to have authentic websites where they tell you that they only take money via a money transfer app—perhaps to transport the pet or for some other reason. They then get away with taking your money without delivering the pet, knowing there’s a slim chance you’ll get your money back. Here are some helpful tips to avoid becoming a victim of a pet scam.

3. Event tickets—This is another common scam where merchants claim they’ll sell you concert or event tickets and say they only take payments through a P2P payment app. If you see such a message, it’s best to walk away. 

4. Prize scams—Perhaps you receive an email, phone call, text message, or a pop-up message on a website that says you’ve won a prize and that you can receive it with a small transaction fee through a P2P payment app. Disregard and delete these messages, as they’re typically from scammers. 

5. Malicious apps—If you were to download an app with malicious software, the fraudster could potentially record your finger taps to identify your passwords or account credentials. In addition, some apps have software that could attack payment apps on your phone to activate transfers to their accounts. 

Before downloading a new app, check that it has a long history, good ratings from third-party sites and reviewers, and testimonials. It’s a good idea to keep your phone updated with the latest operating software, as they typically keep your phone more secure.

Keep in mind, if your gut is telling you something is wrong or too good to be true, then you’re probably right to step back and re-assess the situation.

How to Safely Use P2P Payment Apps

To avoid becoming the next victim of a P2P payment scam, experts recommend that you take the following measures: 

1. Enable security features. Don’t assume that the app already has security measures in place. One of the worst-case scenarios: You lose your phone and then someone finds it and accesses your payment apps. Be sure to set up a biometric lock (fingerprint, passcode, face scan) to access the phone itself and another one on the payment app. You can also turn on “find my device” feature in your phone’s setting, which allows you to erase your phone’s data remotely if your phone is lost or stolen. 

2. Only send money to people you personally know and trust (living up to the name peer-to-peer payment apps). If you send money to a stranger and don’t get what you paid for, it’s highly unlikely you’ll get your money back.

3. Turn on transaction notifications. While some payment apps have this automatically, others don’t. Be sure to check your settings so that you can monitor your account.

4. Triple-check your recipient’s information. Just one itty-bitty typo in a name, phone number, or email address could send your money to the wrong person. Be sure to confirm and verify the information with that person because it’s highly unlikely you’ll be able to cancel it.  

5. Don’t carry a balance on your P2P payment app. Scammers can find ways to siphon the balance idling on your payment app, and if they do, that money may be lost forever. It’s better to keep all your funds in a credit union or bank account, which is usually NCUA- or FDIC-insured. 

6. Think carefully about using P2P payment apps for business transactions. It’s okay to use P2P payment apps to pay small business you know and trust. For all other businesses, it’s ideal to use your credit card, which offers security features (and Visa​® Zero Liability Protection14 for SCCU credit cards). You can also add your credit card to your digital wallet, such as Apple Pay®, Google Pay™, or Samsung Pay​®, and make payments online or in stores that feature these symbols:

7. Never give out your verification codes, passwords, personal information like a Social Security number, or account credentials. And never let strangers borrow your phone.

8. Exercise caution with links, emails or text messages, especially from unknown contacts. Unsolicited links can take you to malicious websites requesting your personal/account information that claim they need a small fee from a P2P payment app first. Some examples of these types of messages: they need your approval to receive a package, you’ve won a prize, or you’ve signed up for a subscription.

9. Expand your fraud prevention knowledge. We offer a wealth of helpful resources to help arm you with information to avoid devastating scenarios, such as our Fraud Prevention Center and articles.

How to Report an Incident

If you’re facing a sticky situation that you believe to be a scam, be sure to reach out to your P2P payment app provider, local law enforcement, and your financial institution. Unfortunately, there aren’t any guarantees with getting your money back, but it’s important to keep your personal and account information safe. Be sure to report any fraud to the Federal Trade Commission, submit a complaint with the Consumer Financial Protection Bureau’s Consumer Complaint Database, and report it to

Why choose Zelle® as your P2P payment app?

In a nutshell, if you’re going to use a P2P payment app, be sure to set up some security measures first to ensure your money’s safe. Again, it’s best to send money only to people you personally know and trust. 

We offer Zelle​® in the SCCU Mobile app and in Online Banking! Zelle​® is a fast and free way to send money to friends and family. Plus, when you use Zelle​® in the SCCU Mobile app, you can feel rest assured knowing your information is protected with the same technology we use to keep your SCCU account(s) safe. 

For easy access to Zelle​® through the SCCU Mobile app, here’s how to enroll: 
  1. First, make sure you have the most recent version of the SCCU Mobile app; then log in to the app.   
  2. Next, select Zelle​® from the menu. Tap ‘Sign up for Payments.'
  3. Then, tap ‘Get Started.’ 
  4. Choose to add either your email address or U.S. phone number. If you have Zelle​® with another institution, you’ll need to use a different email address or phone number that’s not already in use. Zelle® doesn’t allow you to use the same phone number and email with different institutions. Tap ‘Continue.’
  5. If you choose a phone number, you'll then be prompted to read a notice regarding receiving text messages. Then, tap ‘Continue.’ You’ll then receive a 6-digit code to verify your phone number (or email). Do NOT share this code with anyone. Enter the code and click ‘Verify.’ 
  6. You can select one or more of your SCCU checking or savings accounts for Zelle​®. Then, click ‘Confirm Account.’ 
  7. That’s it! You’re ready to send and receive money with Zelle​®

U.S. checking or savings account required to use Zelle​®. Transactions between enrolled consumers, typically occur in minutes and generally do not incur transaction fees.

Zelle​® and the Zelle​® related marks are wholly owned by Early Warning Services, LLC and are used herein under license.
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