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What You Need to Know About the Risks of Mobile Payment Apps Learn how you can protect your business when it comes to point-of-sale systems for smartphones.

By Dan O'Shea

Opinions expressed by Entrepreneur contributors are their own.

Mobile-Wary: Securitymetrics' Gary Glover.
Mobile-Wary: Securitymetrics' Gary Glover.
Photo© Matthew Turley

The first way to answer this question is with another question: How badly do you need to use a mobile phone point-of-sale app right now?

Most of the mobile POS apps released by companies like VeriFone, Square and others in the last 18 months employ a card swiper accessory that connects to a smartphone, though some may require a merchant to input customer credit card information using the phone keypad. The potential benefits: You unchain yourself from the cash register and the equipment and connectivity costs associated with a fixed, dedicated POS solution.

But Gary Glover, director of security assessment at auditing firm SecurityMetrics, says that for now, the apps carry risks for small-business adopters.

The new mobile apps should not be confused with other wireless POS systems, Glover says. These older systems--the kind that allow you to pay at the table at a restaurant, transmit credit card info over a dedicated Wi-Fi connection--do not have general internet access or share their connections with other devices. Mobile POS apps can be downloaded to any smartphone and use the same OS as other apps without firewall protection on a device that's always connected to the internet.

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