Money Minute: Is your money in digital payments apps protected?
PITTSBURGH (KDKA) — Apps like Venmo and PayPal are convenient and easy to use.
But is your money as protected there as a traditional bank? KDKA-TV money editor Jon Delano answers that in this week's Money Minute.
Digital payment apps are very popular, especially with younger adults, with 85 percent of those under 30 using them. But the Consumer Financial Protection Bureau is warning anyone who puts money on these accounts of one important difference between a digital payment app and a traditional bank or credit union.
Funds stored on those non-bank accounts may not be protected or automatically insured through the Federal Deposit Insurance Corporation, which now protects up to $250,000 in your bank accounts.
If you don't keep much money in digital apps, then you're probably OK. But if you have hundreds or thousands of dollars stored there, your money could be at risk.
Check out your user agreement. Some apps may try to offer protection, but play it safe and read the fine print.