Credit Cards v PayPal. Which is More Secure?
As the global marketplaces expand with businesses trying to fit into the online payment industry, so too, are payment methods starting to become flexible and allow consumers more choice. Without searching for the most widely used payment options, PayPal and Credit Cards (namely Visa & Mastercard) make it to the top of the list. But which one is preferred and which is safer?
Consumers are rightly concerned about the protection of their personal information, and of course, the safety of using a particular payment service for online transactions. Purchasing online can be tricky especially if you still prefer the cash-on-hand method, but online shopping can be addictive once you get the hang of it!
Based on consumer surveys, almost 20% of consumers do not buy online and prefer instead to walk into a physical store because of security concerns such as identity theft. From a more recent consumer study, results show that consumers who hesitate to shop online went from 20% up to 34%, while 29% have the same reaction towards shopping in “bricks and mortar” stores.
Credit Card as a Payment Option
Essentially payment options, no matter what they are, seem safer when the customer knows the seller or merchant. Consumers prefer credit cards in the long run because initially, they do not have to subscribe to any account and if they know the seller well enough, using their credit card to pay doesn’t present any risk. Not having any idea how PayPal works or the mere fact that it exists is another reason consumers may favour the plastic.
A study by Bizrate Insights showed that 62% of consumers do not feel secure giving out their personal information when using their credit card to purchase an item in a physical store. A reason for this apprehension from consumers might be that giving out personal information has been the source of most data breaches in recent years. 60% of those have the same response towards websites and 65% on mobile retail sites.
PayPal as a Payment Option
Online security studies show that shoppers feel PayPal is safer to buy with than a credit card. A recent report also stated that PayPal has been effective in reducing customers’ online security concerns because they have proactively embraced consumer protections. Online buyers have rated this payment solution company as the second most trusted retail payment service, as it works faster than inputting account numbers every time you buy something online. On the other hand, businesses often overlook the benefits of using PayPal when performing B2B transactions due to their perception of PayPal as a service for end-users.
No consumer is 100% safe when it comes to shopping online and likewise, no payment service guarantees full security and safety. In the end, security is largely dependent on how you, as a customer, treat your online accounts and credit card information.
PayPal has been named as the largest online payment system in the industry, but it still has various cons. As for your PayPal and credit card accounts, treat them as you would a traditional bank account. Make it a habit to check your accounts religiously, and always update your computer security software.