CFPB Announces Inquiry into Mobile Financial Services and Issues Consumer Tips on Use of Mobile Devices

In a Request for Information (RFI) announced earlier this week, the CFPB notes that a large percentage of unbanked and underbanked consumers, many of whom are low-income, have access to mobile phones, a significant number of which are smartphones, and that accessing financial products, services, and financial management tools via mobile devices has the potential to empower consumers to take more control over their financial lives, to increase savings and reduce debt.

Given the increasing use of mobile financial services and the potential benefits (and risks) to consumers, the CFPB is seeking information on, among other things:

1. The ways in which consumers use mobile technology to access financial services;

2. How mobile financial services can reduce costs for consumers;

3. How financial institutions are marketing mobile financial services, and whether those efforts include any outreach to underserved communities;

4. Challenges and barriers to expanding the use of mobile financial services, including privacy and security concerns; and

5. Consumer protection issues that may warrant additional protections for the economically vulnerable and underserved.

The CFPB has invited comments from all members of the public, including individual consumers, consumer groups, academics, and financial institutions, on these and other issues identified in the RFI.  The comment period will end on or about September 9, 2014.

In addition to the RFI, the CFPB also published tips on how consumers can better protect themselves when using their mobile devices for financial transactions. The tips include security best practices such as using strong passwords, closing browsers after completing financial transaction, using only secure websites, apps, and hardware, and removing sensitive information from old mobile devices.

Authored by Michael Epshteyn