Castler Escrow

Online Payment Speeds Must Slow Down

When it comes to processing high value transactions, there is often much at stake - and this stake can take on innumerable forms. It could be monetary, emotional, personal, and/or political. This stake plants seeds of doubt in our mind while we transact online - it is in the nature of humans to be generally cautious. Caution is, in fact, survival for us - and this applies quite literally to your money as well.

A very natural progression of carefulness can be observed as you go ahead to process transactions whose gravity changes. Being smart creatures, we understand the opportunity cost of a mishap in high value transactions. Since everything cannot be guaranteed, we need to be willing to take a step back from convenience. If a better solution comes at the cost of a comparatively moderate solution, then that’s a good trade-off.

The Dichotomy of Online Payments

On this tangent, it is undoubtedly true that online payment methods have been both a boon and a bane. Digitisation has overhauled every traditional activity, and transactions are no exception. The digital revolution picked momentum because of a dream – the promise of increased speed, ease, and improved accessibility was more than attractive. At the time when the digital revolution started to gain momentum in the 1950s, when the web was introduced, tedious payment processes through manual means were the norm. Today, however, we can little imagine what pulling out wads of paper and grams of coins in your pockets was like. Exchanging thousands of dollars had to involve a Bond-like setup, complete with a briefcase and a very purposeful pair of black shades. Today transactions occur at lightning speed, except for those who do not possess 4G connectivity and are woeful. Such as our tendency of getting used to the “convenient”.

Convenience vs Safety

But convenience becoming the new black does not mean that it can’t be misused with capitalistic intentions. The possibility of an intentional or unintentional glitch while paying digitally is omnipresent. Reality gets a bit grim here, but every time you move to pay via UPI, keep in mind that there is a decent chance you’ll get scammed. 2.5% of all UPI transactions are frauds, and these frauds are carried out through a variety of creative means – phishing, vulnerability attacks, security attacks etc. Frauds aren’t always ingenious either. Many times they prey quite simply by seizing the loopholes in our knowledge – sharing a fake account number, convincing you to share your UPI ID, pretending to help you out with the ATM machine and capturing your card details through an ingeniously camouflaged camera device. To top it all off – technology isnt perfect. There can be an occasional error due to which you may either get a crore bucks deposited into your account randomly, or be stripped of all your savings with a swish and flick. Glitch happens.
But the crux of all this talk is that safety is more important than a 5G connection when it comes to money. And for precisely this reason, if some immediate perks have to be cancelled out, it is okay.

Would Scam Detection Hotlines Help?

A very recently published article by BBC mentions that due to the rapidly rising rate of frauds in the UK, payment speeds must slow down. The solution to the problem of rising frauds presented by the BBC article is to create a fraud detection hotline. The hotline is intended to help people confirm whether or not to trust a party they plan on paying online. This is an example of a ‘necessary inconvenience’. It has a good ROI on the investment of your time and effort. But amongst a host of inconveniences that could have been created, this is not the best. Good problem solving enables clarity and some control over the process of the solution. Outcome is simply one part of the process. Instead of having to rely on an external factor (here it would be the person offering support through the hotline), would it not be easier to adopt a fool-proof online payment method? A convenience?

Digital Escrows Would

Digital escrow services are not the fastest modes of payment. They offer multiple levels of authorization for every transaction you make, which means it can take a few hours to process a transaction. But it should be noted that a security-based processing delay is imperative. Desirable, even. In fact, these perceived “drawbacks” create the strongest case for digital escrows – the purposeful delays add multiple layers of security to each transaction, and the possibility of frauds and/or glitches is eliminated. The chance of 3+ verification agents slipping-up is as slim as it gets.

The "Feel-Safe" Problem

There’s another factor that isn’t stressed upon sufficiently – people can appear to be completely legitimate and still scam you. A very recent case occurred wherein a man ordered a Samsung phone off of Amazon and was delivered a dish of soap inside the package. Perhaps the seller had not been verified properly. Perhaps he had excellent ratings (which can be false – family and friends are often helpful). But the profile of this seller must have seemed convincing to the buyer.
There is simply no way of knowing whether you will receive the product you were promised or not. This is the spectrum of a transaction or order that is beyond your control. But you can do something about the repercussions or outcome of a scammy product getting delivered to you.
Digital escrow can ensure that you don’t pay a seller unless you’re satisfied with the delivery. Normally, online payments are processed the other way round – first someone pays and then someone sells. Most payment sites are now seller-focused, especially when they don’t offer services like ‘cash on delivery’ or ‘buy now pay later’ (both of which come with their own set of issues, which we’ll cover in our upcoming blogs).

We Need More Control

Globally, government and security agencies ought to focus not just on maximising safety and security in online payment methods, but also on making sure that the user ‘feels secure’. Of course, a dichotomy arises here – the ‘feel secure’ idea is the primary USP sold by digital payment platforms like PayPal. But they don’t guarantee that something won’t go wrong. Nothing probably would, but it very much could. And in big ways. It is therefore important to leverage technology in ways that help one become equipped to evade scammers. The solution is building a robust, fraud-proof transaction ecosystem – one that would offer independent control to the user and at the same time enables confidence, trust and faith over transactions.

Comment your thoughts down below and share with us what you think! You can also mention any particular fintech topics you would like us to cover in our upcoming blogs.

Read More: Digital-Only Banking is Looming

Consumer Escrow

Enterprise Escrow

Support

Facebook Instagram Linkedin