What follows is a look at some of the concerns that evaluation raised, plus a handful of ways consumers can protect themselves. Direct app use and testing of that kind, as well as a full application of the framework’s seven principles, will be part of future evaluations, Hand says. (For details, see CR’s full report on P2P services.) CR researchers used the apps to locate and review those materials but did not use or test the apps directly to determine, for example, how easy they are to navigate and use, or how much personal user data they capture. ![]() For its preliminary P2P evaluation, however, CR focused on the first three to determine how safe the apps are to use, how they collect and handle user data, and how transparent they are about the practices outlined in their consumer disclosures.ĬR analyzed the terms of service, privacy disclosures, and other publicly available documents found on P2P company websites and mobile apps. When fully deployed, the evaluation framework will look at seven broad areas, or “principles,” of consumer concern: safety, privacy, transparency, user-centricity, financial well-being, inclusivity, and environmental, social, and governance concerns. (For Zelle, the researchers looked at the stand-alone Zelle mobile service and the bank apps of three large, national banks that allow customers to send cash via Zelle, which might not necessarily be the version you enter from your bank’s website or mobile app.) CR plans to apply the full framework to other fintech categories in the months and years ahead, including buy now, pay later loans, mobile banking apps, and cryptocurrency wallets and exchanges. CR began with a limited application of the framework to four popular P2P apps: Apple Cash, Cash App, Venmo, and Zelle. “Meanwhile the regulatory vacuum around these new tools has allowed potentially unfair, unsafe, and discriminatory practices to spread unchecked,” Hand says.įor this reason, CR has developed the Fair Digital Finance Framework, a set of criteria and procedures for evaluating a range of digital finance products and services. These services offer clear benefits but can also leave consumers confused and uninformed about how they work, how to choose among them, and the risks they face when using them. A broad range of financial technology, or fintech, innovations have provided consumers new, mobile-device-centric ways to borrow, spend, and invest money and monitor their credit scores. ![]() In fact, Hand says, the problem is bigger than P2P payment apps. ![]() Unfortunately, user protections and regulations are not keeping pace with the speed of P2P payment app adoption, or the evolving risks consumers face when using these apps, says Delicia Hand, director of financial fairness for Consumer Reports.
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