Know your payment options: How to shop and pay safely this holiday season

The day has come: it’s Black Friday, and once-in-a-year promotions, discounts and deals are everywhere. The rush to grab a bargain has started in earnest, and in times of soaring inflation many deal-hungry shoppers are ready to make big purchases, perhaps the kinds of purchases they didn’t get to make earlier in the year. As if that weren’t enough, Cyber Monday is soon upon us just days later, making us crave yet more deals online!

While Black Friday has a long history in the US, the annual shopping frenzy has also become a hot trend in Europe and elsewhere in the world. Over time, the idea of camping out at your favorite retailer for unheard-of deals has lost its sparkle, with more and more people pivoting to offers on e-commerce platforms such as Amazon.

The COVID-19 pandemic has further helped fuel the rise of online shopping, which is now worth over $4 trillion annually. As our shopping habits have been shifting, overflowing shopping carts have morphed into endless lists of purchased items in our email inboxes.

Make no mistake, though: many people still prefer the rush and immediate pleasure of taking those highly coveted items home from a brick-and-mortar store. Surprisingly, this is the case for many Generation Z shoppers, who will be heading to the malls and shops to try to relive the tradition.

Now, whatever generation you belong to and wherever you decide to buy, you will quite likely be making cashless payments.

How exactly do you want to pay?

It is usually easy to track how much you spend when you watch the cash in your wallet disappear as the day goes by, but online payments have no such “physical element” to them: instead, they come with a notification that can be all too easy to ignore. Our payments became so seamless and so integrated within most online platforms we use that quite often choosing a payment method is just a matter of ticking a box.

Mobile phones that double as wallets, face recognition systems that replace PIN codes, “pay later” options, disposable virtual cards, the list goes on. Online or in-store, payment options are endless these days. So which should you choose?

Cards & contactless payments

While credit and debit have been around for a long time, many banks don’t even issue actual physical plastic cards anymore, especially if you use a FinTech platform. Instead, they are just an image that pops up on your phone when you trigger it with Google Pay or Apple Pay.

This became a convenient payment method during the COVID-19 pandemic, accelerating the use of NFC technology that powers contactless payments via mobile wallets as well as contactless cards. In the United States, this technology is so widely accepted that 59% of SMBs plan to accept only cashless payments by 2024.

Although contactless payments are generally safe, it is important to be aware that some banks don’t require a PIN code or signature for small purchases. It’s generally very important to always carry your card safely, storing it in a wallet rather than in your pocket. And if you lose it or someone steals it, call your bank right away.

Contactless payments through mobile wallets, like Google Pay and Apple Pay, are also good options that can be used in shops or online. Always make sure the app or website you’re shopping on is secure.

Also, with your phone being home to your sensitive information, including payment data, losing your phone could be equivalent to losing your actual wallet. As a precaution, you should, for starters, keep your phone secure using a biometric lock and/or and a strong lock code, ideally also for transactions themselves, That way, even if your phone is lost or stolen, you’ll prevent the thieves from going on a shopping spree or racking up charges on your credit cards.

Tip: Many banks already allow you to create one-time-use cards, virtual cards with their own card number, expiration date, and CVC/CVV code that are linked to your account. Once you use them, they are automatically destroyed, so if you happen to use it on an unprotected website that compromises your data, criminals won’t be able to use that card again. But if you return a product or are expecting a refund for a purchase, the seller can still use the details of the disposable card to return your money.

Payment aggregators

While payment aggregators might be a name you haven’t heard of before, most of us know and have used PayPal or Square. And even if you don’t have an account with them, you’ve seen them as a payment method on online retailers or even on your phone bill through a QR code.

These third-party services allow you to gather a few different payments methods, for example, a bank account and two debit cards linked to different banks. This way, if you’re using PayPal, for instance, instead of having to enter your card details every single time or search for your account number to make a transfer, many platforms, such as Amazon or Target, will allow you to click a button that will transfer you to your PayPal login for approval.

Tip: Enable two-factor authentication (often known as two-step verification) in your PayPal account or any other payment service of choice. This simple step will ensure that if someone steals your password, they won’t be able make any purchases without a one-time passcode.

But that’s not all!

Payments through mobile providers: More common in some countries than others. This is a very handy way of making online purchases without having to give away your card details. Some platforms, such as Spotify or Netflix, will offer an option to “Pay via partner companies.” This will allow you to have your subscriptions, or other purchases, billed directly to your phone bill together with your plan charges.

ATM payments: In some countries it is also possible to pay for a purchase on automated teller machines. The merchant will send an email at checkout with a business number and a reference code. The transaction will be placed on hold for a few hours until the seller receives a payment conformation to prepare the order. If time runs out, you will need to repeat the purchase.

QR codes: One of the easiest ways to make a payment, but it can also be a headache. While most QR codes will lead you to a specific page to enter your card details in order to make a payment, some require specific apps you might not have downloaded. At the same time, watch out: If you are not absolutely sure of the origin of a QR code, don’t scan it. Request a different payment method instead. These black and white square images might be a way to scam you and steal your card details through a fake website.

And now that we’ve mentioned scams, remember these few tips when buying online on Black Friday and Cyber Monday (or any day of the year):

• Don’t click on unexpected links unless you’ve verified they’re secure. Instead, type in the website URL and do your own search for the product. Use reliable and trustworthy retailers.
• Ensure you’re making a purchase from a legitimate website. While not a foolproof solution (even scammers can obtain security certificates), the website you buy from should use HTTPS so that your data can’t be intercepted by a criminal.
• Don’t save debit or credit card details online for future payments. They may become compromised if there’s a data leak or your account information is stolen. Use disposable cards or payment aggregators instead.
• Don’t fall for a too-good-to-be-true deal that someone is suddenly writing to you about on WhatsApp. It’s almost certainly a scam.
• Check cancellation and refund policies before buying something. It is easy to succumb to the impulse of a good deal – just make sure you can get your money back if you change your mind.

Make sure to read also our 10 tips for avoiding Black Friday and Cyber Monday scams.