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NewsBriefs

This article contains excerpts from news stories recently posted under Their study revealed that outdated authentication meth-
Breaking Industry News on our homepage. For links to these and other ods and a focus on convenience over security leave users
full news stories, please visit www.greensheet.com/breakingnews. susceptible to fraud. They found that digital wallets rely
php. on weak authentication processes, allowing fraudsters to
use stolen card details to make unauthorized purchases.
Additionally, when a card is reported stolen, banks often
fail to re-authenticate the card stored in digital wallets, as-
suming existing security is sufficient.

The researchers disclosed their findings to banks and dig-
ital wallet providers, with some, like Google, stating they
are working on fixes. However, the research team empha-
CFPB eyes POS cash-back fees sized the need for both banks and wallet providers to take

The Consumer Financial Protection Bureau (CFPB) is scru- greater responsibility for enhancing security measures,
tinizing large merchant chains for charging fees to con- such as re-authenticating cards and improving authenti-
sumers who request cash back at the point of sale (POS) cation protocols to better protect users against fraud.
using debit or prepaid cards. Traditionally, cash back has PayPal wants to be everywhere consumers shop
been a no-cost service offered by many retailers, but some
chains, such as Dollar General, Dollar Tree and Kroger, PayPal is expanding its in-store payment presence by
have begun charging fees, collecting over $90 million an- enhancing its rewards program and integrating its debit
nually. cards with Apple Wallet, enabling contactless payments.
The company’s updated rewards program allows custom-
The CFPB’s report suggests that lower-income consumers ers to earn 5 percent cash back on selected spending cat-
in areas with limited banking access are disproportion- egories, such as groceries or clothing, and stack additional
ately affected by these fees. Merchants argue that rising rewards from merchants like DoorDash and Instacart.
interchange fees from acquiring banks and their payment PayPal has also streamlined the process for setting up
processing partners are the primary reason for imposing digital debit cards and direct deposit, offering automatic
cash-back charges. The fees for cash back generally range balance reloads and physical debit cards at no extra cost.
between 50 cents and $1, but they can vary significantly
by location, with some stores charging as much as $2.50. These initiatives aim to provide a seamless omnichannel
payment experience, combining the convenience of digi-
While the CFPB acknowledged that only a few large retail- tal transactions with the security and benefits of PayPal’s
ers currently charge these fees, it is concerned about the rewards, PayPal stated, adding that by partnering with
implications for cash access. The agency plans to continue Apple, the company aims to boost its presence in physical
monitoring the situation to ensure fair access to cash for retail stores and further solidify its role in the global pay-
all consumers. ment ecosystem.

Researchers ID digital wallet vulnerabilities Juniper Research predicts 209%
increase in A2A payment by 2029
Researchers from the University of Massachusetts Am-
herst and Pennsylvania State University have identified Juniper Research forecasted a 209 percent increase in glob-
significant security vulnerabilities in digital wallets, such al account-to-account (A2A) payment transactions, from
as Apple Pay and Google Pay. 60 billion in 2024 to 186 billion by 2029. A2A payments,
which enable direct bank transfers without intermediar-
ies, are gaining popularity due to instant settlements and
lower transaction fees.
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LinkedIn & Twitter for the The growth is fueled by open banking initiatives, which
most up-to-date stories, allow third-party providers to access financial data and
can’t miss events and newest initiate payments directly. In addition, variable recurring
industry announcements. payments have emerged as a flexible and transparent al-
ternative to traditional recurring payment methods like
direct debits.

The launch of FedNow in the United States and the real-
time payment rails globally are accelerating the adoption
https://www.facebook.com/TheGreenSheetInc of A2A payments, which can offer enhanced security and
https://www.linkedin.com/company/the-green-sheet cost-efficiency, appealing to both businesses and consum-
ers.
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