Phone payment technology: how it works and is it secure?

Smartphones are now a fundamental part of most people’s lives. They take our photos, help us catch a train on time and tell us when it’s going to rain. Now, they even pay for things.

Phone payment options have been launched by major banks around the country and are rapidly evolving to become more and more convenient.

For many people, the main barrier to ditching the wallet in favour of this technology was concerns around security, but with more stringent checks and balances than credit cards, security is fast-disappearing as a roadblock for many Australians.

What are phone payments?

The phone payment process initially involved a small PayTag chip that had to be attached to phones and used in the same way as a debit card PayPass function. You could tap and go for purchases under $100 dollars using the chip which directly accessed your transaction accounts.

Now, for many phone users, the process is far more high-tech. Android phones enabled with Near Field Communication (NFC) technology can now tap without a chip, although purchases over $100 will still require your pin number.

How secure is it?

Late-technology adopters will probably still liken the safety of such systems to posting their credit card details on an online forum, but the reality is, these security measures are in place to protect your funds. Pin passwords protect the tap and go function from being opened by anyone without the code and some apps also allow your fingerprint to be added as a further security measure.

Having a passcode on your smartphone to begin with is also yet another way of protecting your money. The more complex the better so steer clear of the commonly occurring 1234 and 0000 combinations.

Apart from these smartphone specific security measures, all your bank’s standard protections should apply. These include usual policies for counterfeit and fraudulent transactions that generally involve a refund for purchases not made with your permission.

As well as this, losing your phone has become much like losing your credit card in that with one call to your bank, you can cancel all further transactions and access from your phone.

To check your bank’s Mobile Pay security policies in depth visit their website so you have a good idea of the protections available.

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What are the benefits?

The major selling point of the technology is that you don’t have to worry about forgetting or losing your wallet.  These days, most people never leave their smartphone out of reach so the chances of you not having your phone on you in a store are low. Of course this could lead to more impulse purchasing, depending on what kind of shopper you are, but the convenience is undeniable.

You can even use your phone to withdraw cash in emergency situations with banks such as ANZ allowing you to make withdrawals at certain Mobile Pay enabled ATMs. Cardless withdrawals can also be made at ATMs if you are with certain banks, such as Westpac, by simply getting a code from your app and entering it in the ATM.

Essentially your phone can now do everything your card can and is just as secure. In fact your phone can actually one up your card because you can have multiple card details and access on one phone.

While the access you have to these different technologies will vary depending on which bank you are with it’s something to keep in mind when evaluating your transaction account. If you want access to these smartphone perks you may need to consider switching banks to one with phone payment options.

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Learn more about bank accounts

Can I close my bank account over the phone?

In most cases, you can close a personal or business bank account over the phone. In fact, this is the best way to ensure you’ve closed an account properly.

By speaking to a banking representative, you can capture and close out any pending transactions, or interest owing/payable on the account being closed.

In the instance where the account is a joint account, or you have multiple bank accounts you want to close, your bank may send you a form that you need to fill out and return.

Either way, you would be advised over the phone of the steps you need to take. Calling your bank ahead of closing an account is often a smart course of action.

How do I close my bank account online?

You can usually easily open a bank account online, but you often can’t close it online.

Many banks and credit unions will only let you close an account if you go into a branch or call them on the phone.

However, some banks will let you request to close the account via your internet banking. Check your financial provider’s website for details.

Just remember: If you still have funds in the bank account, transfer them to another account, or withdraw the cash. Also, if you have any payments like direct debits going in or out of the bank account, these will also stop when you close your account.

How do I close a bank account?

Closing a bank account is one of those tasks that’s easy to put in the too-hard basket. There are quite a few steps involved, some which may require you to hang on the phone for a while.  

Here’s a handy checklist of items to tick off, so the job gets done quicker. If you don’t do your banking online, the following steps can also be done at a branch.   

  • Cancel any scheduled or recurring payments
  • Update your direct debit details (such as loan repayments) with creditors
  • Export your payee address book (to keep a record of saved third-party bank account details)
  • Transfer the balance of your account (to the new bank account)
  • Close your account online, or by calling the bank or visiting a branch

Can you open another account at the same bank?

Yes, you can open another account at the same bank if you already have an account there, but some banks place a limit on how many specific accounts you can open.

Generally, though, it is possible to have more than one everyday account, one personal account and one joint account, or have different types of accounts – such as a transaction account and a savings account.

Keep in mind that some bank accounts come with fees, so you could be charged twice for having two types of the same account at the same bank.

Also, if you have more than one high-interest transaction account at the same bank, only one account will be able to earn the highest rate of interest.

How do you open a bank account in Australia?

Opening a bank account in Australia is usually a straightforward process. Some banks give you the option of opening an account online, while others require you to visit a branch.

Different bank accounts offer different features, so it’s best to compare your options to find one that suits you.

All banks require you to pass an identity check to open a bank account. Australia uses the 100-point identification system, which means you’ll need to show a number of forms of ID that, together, add up to 100 points.

Common ID types include a driver’s licence, passport, Australian visa in a foreign passport, and Australian Medicare card. You’ll find out what types of ID are accepted when you go through the sign-up process online or at a branch.

Once your account is open, you’ll be given or sent a debit card that you can use to make purchases and withdraw money from your account.

How do I open a new bank account?

There are a number of ways to open a new bank account – online, over the phone or in the branch. The trick is to decide what type of bank account you want beforehand.

It might sound like a simple enough task, but there are literally hundreds of bank accounts to choose from. And each offer their own banking features and benefits.

A comparison site like RateCity can help you work out what bank account product matches your needs.

Once you’ve made up your mind what you want, it’s advisable to have the following information ready for the application process.

  • A couple of forms of identification (such as driver’s licence, Medicare card, passport)
  • Tax file number
  • Residential address, contact phone number and email (though email is not essential)

How can I deposit cash into my bank account?

The traditional way to deposit cash into your bank account is to go to a branch and give it to a teller. These days, many banks will allow you to make deposits through an ATM as well.

How do you transfer money from PayPal to a bank account?

Transferring money from PayPal to an Australian bank account is simple. Just follow these three steps:

  • Go to your Wallet
  • Click ‘Transfer Money’
  • Follow the instructions

The money will take three to seven business days to reach your bank account.

Once you’ve made the transfer request, it can’t be withdrawn.

Opening a bank account for someone under 18

Do I need to open a business bank account?

Just because you’re in business doesn’t necessarily mean you need a business bank account. You could be a sole trader not registered for GST, and use your personal bank account for business.

If you do want a business account, there are plenty of benefits attached to business transaction and savings accounts, as well as business term deposits.

There are business bank accounts designed for businesses with a high volume of transactions, and those for start-ups with a small amount of trade. You could also include an EFTPOS service with your account.

Some business bank accounts charge for the number of transactions per month, while others offer a pay-as-you-go fee structure, where you only pay fees for transactions you make.

It’s up to you whether your priority is mainly transactions, or earning the maximum amount of interest on your principal. There’s a business banking solution for you if you need one.

Can I find my bank account number online?

Yes, you can find your bank account number by logging into your online banking and clicking on the relevant account.

How do you set up a bank account online?

Once you’ve compared bank accounts and found the right one, the process of opening a bank account online is quite simple and can be done in around 10 minutes.

To set up a bank account online, you’ll need to prove your identity and provide an approved form of ID as well as your tax file number (TFN).

If you’re a new customer of the bank, you’ll need to verify your identity and potentially upload documents before you can complete your online application.

Once your ID has been verified and you’ve set up your bank account online, you should receive your bank cards in the mail along with your PIN and any other account details.

How can I close a Commonwealth Bank account?

You can close your Commonwealth Bank account at any branch, provided you have appropriate identification. You can also close your account over the phone, by calling 132 221, 24 hours a day.

Can foreigners open bank account in Australia?

If you’re migrating, studying or working in Australia, you’ll be pleased to know that you can open an Australian bank account. For the most part, opening a bank account in Australia is a simple process which starts by comparing the types of bank accounts foreigners can open in Australia.

Once you’ve found a bank account that suits your needs, you can start the application process.

When you apply for the account, you’ll need to provide proof of ID which may include your passport, overseas ID or credit card. You may also need to provide a copy of your visa and proof of address in Australia.

Depending on the bank and the type of account you choose, you may be able to apply for the account online or over the phone before you arrive in Australia.