PayNow to cease nickname option for users soon

A new “masked account name” feature will be introduced that will hide certain letters so that their full names will not be revealed. PHOTO: ST FILE

Invest Editor

Updated

SINGAPORE – A security measure due next year will prevent PayNow customers from using nicknames when making online fund transfers with their phones.

But they can still stay anonymous. A new “masked account name” feature will be introduced that will hide certain letters so that their full names will not be revealed.

The move to remove the nickname option comes in the wake of recent cases where some crooks adopted the names of legitimate companies as their nicknames in order to dupe victims into transferring money via PayNow to their bank accounts.

The victims were told to scan doctored PayNow QR codes that the fraudsters created using nicknames and mobile phone numbers so that there was no need to key in a company’s unique entity number (UEN) when making a payment.

Such scams are hard to detect because the victims see the names of legitimate firms after scanning the fake codes, and think that they will be the recipients of the money. The only way they can avoid the fraud would be to key in the UEN, but not many people will take the trouble to ask for and key in the numbers themselves.

The Association of Banks in Singapore, which is working with banks and other financial institutions to implement the new security feature, did not elaborate on whether the ceasing of the nickname function was prompted by such cases of impersonation, some of which are under police investigation.

But it did say that the new “masked account name” feature will let users “pay their payees with confidence, mitigating the risk of payee impersonations while not revealing the payee’s full name”.

The nickname feature has been available since PayNow was launched in 2017 and is meant to address privacy concerns among individuals who do not want to reveal their registered full name when someone makes a payment to their mobile number.

Businesses using PayNow to receive payments are not permitted to use a nickname or change their registered account names.

A PayNow user, Madam Ng Poh Leng, fell victim to the nickname ruse recently when she made several cash transfers totalling about $60,000 as part payments for a car that she bought from well-known dealer CarTimes.

The salesman who served her told her to scan a PayNow QR code, which brought up the seemingly legitimate name “CarTimes”.

But the money went straight into the salesman’s personal account because he used “CarTimes” as his nickname.

Madam Ng, who helps to run her family’s bakery business, said: “I did not suspect anything at all because it is quite common for companies to include such QR codes to facilitate payments. Before I confirmed the payment, I even checked the recipient name, which was ‘CarTimes’, and so I went ahead with it.”

CarTimes managing director Eddie Loo, who confirmed that the money Madam Ng sent via PayNow did not end up in the firm’s bank account, has lodged a police report against his former employee for the alleged embezzlement.

Mr Loo honoured Madam Ng’s purchase and delivered her new car, but his company is now caught in a legal wrangle to recover the money that was lost as a result of the rogue employee’s action.

“To avoid mishaps like mine, I would advise those making PayNow transfers to companies to check and pay using the companies’ unique entity number, and don’t just scan the codes,” he noted.