Many Apps Fail to Provide Information On Payment Dispute Mechanisms, Privacy

A new staff report issued by the Federal Trade Commission finds that many mobile apps for use in shopping do not provide consumers with important information -- such as how the apps manage payment-related disputes or handle consumer data -- prior to download.

The report, “What’s the Deal? An FTC Study on Mobile Shopping Apps,” looked at some of the most popular apps used by consumers to comparison shop, collect and redeem deals and discounts, and pay in-store with their mobile devices. The report makes a number of recommendations to companies that provide mobile shopping apps to consumers:

• Apps should make clear consumers’ rights and liability limits for unauthorized, fraudulent, or erroneous transactions.
• Apps should more clearly describe how they collect, use, and share consumer data.
• Companies should ensure that their data security promises translate into sound data security practices.
• Beyond recommendations for companies, the report also urges consumers to closely examine the apps’ stated policies on issues like dispute resolution and liability limits, as well as privacy and data security and evaluate them in choosing which apps to use.