How to Use Text Alerts to Protect Against Fraud

Americans check their phones every four minutes, on average – or about 344 times a day – which makes text alerts a great early-warning tool against fraud. When a quick reaction is important, mobile text alerts may be the best way to get someone’s attention: 70% of us will check our phones within five minutes of hearing that notification chime.¹

Financial institutions, including banks, credit card issuers, investment companies, and others, have embraced text alerts as the best means of communicating with their members. After all, nearly two-thirds of bank customers today use their institution’s mobile app – and 41% don’t use anything else.²

Text alerts can be an effective fraud prevention tool, but you usually do have to sign up. Federal and state laws regulate who can text you and how, so you may need to opt in to get text alerts.

Setting up text alerts is fairly routine. When opening most accounts, banks or credit card companies will ask about customers’ communications preferences, so you can sign up for text alerts right there. After the fact, you can adjust those preferences through the institution’s website or mobile app. Once you begin receiving texts from your bank or credit card company that you know are legitimate, add that number to your phone’s contacts to make them easier to spot and to distinguish them from fraudulent texts (more on that later). You can also receive push notifications (which show up on your phone’s lock screen) from your banking or other financial apps by going to the phone’s settings and enabling push notifications for the app.

Texts that alert you to suspected fraud are only one of several different kinds of mobile text alerts available from many financial institutions. Text alerts can provide a heads-up when a bill is coming due, tell you if your account balance is low, or notify you that your spending is hitting a limit that could clash with your budget. Some alerts, such as instant notification of every new transaction, can also help to avert fraud, though most are mainly useful for your overall financial well-being.

Many financial institutions let you set up separate alerts, to be triggered by any of the following events:

• Purchase transactions: Some card issuers will send text notifications each time you use your card, so you’ll know instantly if a transaction occurs that you have not authorized.
  
  
• Transfers: You may be able to get alerts about any cash or balance transfers between accounts, a ploy used by fraudsters to steal cash from you.
  
  
• Unusual activity: A warning when unusual activity posts, such as a large purchase or a transaction where the card was not present, can help stop a fraudster on a shopping spree using your credit card information.
  
  
• Account changes: Setting up an alert in response to changes made to your user profile, such as a new password or changes to your personal information, can help stymie identity thieves, assuming you didn’t initiate the change. A message that your account has been locked could indicate that a hacker has been trying to crack your password.
  
  
• Secure messages: As a rule, your financial institution won’t send sensitive messages over text. But it will send a text to let you know that such a message has been sent to your online account and ask you to log on to retrieve it.

With so many potential alerts, you may fear being overwhelmed by a constantly chiming phone. But many institutions let you adjust the types and frequency of alerts. You can shift alerts that are less time-sensitive from text to email, and those where speed is critical to text with push notifications.