Group Urges Mobile Carriers to Beef up Consumer Protections for Mobile Payments

June 20, 2011

San Francisco-based consumer advocacy group Consumers Union has released a report on mobile payments that highlights how consumer protections vary widely for different mobile payment methods and how wireless carrier contracts fail to provide needed safeguards. “Consumers who link mobile payments to credit cards have the strongest rights, with the greatest caps on liability, the ability to withhold payment of disputed amounts and the right to prompt recredit,” the group wrote in Mobile Pay or Mobile Mess: Closing the Gap between Mobile Payment Systems and Consumer Protections. “Consumers who link their mobile payments to debit cards or bank accounts have the second best set of consumer protections which include limits on liability and the right to recredit within a specified period of time. On the other hand, consumers who link their mobile payments to general purpose prepaid cards and gift cards don’t have the same guaranteed protections as credit and debit cards. The same applies to mobile payments that are debited directly from a prepaid mobile account or are charged to a mobile phone bill.” Recently, Consumers Union sent letters to 18 wireless carriers urging them to strengthen their contracts so consumers using mobile payments are provided protections similar to those offered to credit card or debit card users.