Zelle is a popular digital money transfer app. Bank of America, Chase, Capital One, and Wells Fargo are among the major financial institutions that have collaborated to develop Zelle, a peer-to-peer payment service.
Free payment platforms such as Zelle allow customers to move money between the bank accounts of relatives and friends without having to pay a fee. It does not charge any fees and has a network of about 1,500 banks and credit unions.
However, because of the app's enormous user base, it has become a common target for scammers and malicious threat actors. This year has seen an increase in complaints about peer-to-peer money transfer apps.
Thousands of Americans have lost money as a result of fraud committed using the money transfer app, and millions more may be in danger of losing money.
The payment service, which was developed to compete with existing electronic payment services such as PayPal, Venmo, and Cash App, allows financial institutions to manage small-dollar electronic transactions without incurring any costs from third parties.
The rise of financial fraud, scams, and phishing has been at an all-time high nowadays, which has been brought on by the pressure of the ongoing COVID-19 pandemic, as well as the geopolitical conflict in eastern Europe.
With that, here are a few recommendations from both CNET and Nerdwallet on how to keep your money safe and avoid possible Zelle scams.
How To Keep Your Money Safe
Set Up Two-Factor Authentication Passcode
Zelle users are highly recommended to enable the Two-Factor Authentication option.
Two-factor authentication, often known as multi-factor authentication, is an additional layer of protection that protects your online accounts.
Each time you log into your account, you'll be presented with a one-time password, which is often given via email or text message and is valid for 30 to 60 seconds each time.
Once you've enabled two-factor authentication for your financial accounts, you should never share your one-time passcodes with anybody. Never divulge your two-factor authentication passcode to anybody else, as this can become a gateway to easily stealing your money.
Scammers usually trick numerous users by pretending to be your bank or utility provider. Scammers can easily be spotted when they pressure you with a variety of fake reasons to give them your passcode.
Legitimate bank authorities will not ask for users' private credentials aside from public identification information. It is important to note that you are reminded to never divulge your two-factor authentication passcode to anybody else.
Be Wary of Unsolicited Texts, Emails, and Links
Scamming tactics can now be done in numerous ways online. Another highly recommended device to keep your money safe is to ignore suspicious unsolicited text messages and emails. Another advises you to never click on any links easily, as they may be used by scammers to steal your money.
This piece of advice applies to all potential fraudsters, not only those employing the Zelle payment system. Unless you have spoken with them beforehand, do not respond to a message from your people over the phone that claims to be a representative or employee from your bank.
Make a direct call to your banking institution to inquire about your account and any potential security vulnerabilities that may be present.
Assuming there are no issues with your account, you can also notify your bank that you have been a victim of identity theft. If you have provided personal information as a result of the phishing attempt, you can work with your bank to ensure that your account is protected.
Use Zelle for Family and Friends Only
Zelle is another digital finance app on the market that aims to help people ease their financial transactions. However, due to the alarming rate of increasing scams, it is now recommended to only use it and other money transfer apps to pay people you already know and trust.
Since Zelle, in its nature, is a peer-to-peer app, once you make a transaction on the platform, it is now gone and will hardly be returned once it is sent.
If you make a payment through the app and you are tricked into authorizing the payment, you may not be able to retrieve the money you paid. While it is a convenient and easy payment method, restricting its use to people you know and trust will reduce your chances of being defrauded in the future.
When using multi-factor authentication, app users are highly advised to utilize the phone number and email address that they have on file when sending money using money transfer apps.
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