The Legal Framework of Mobile Payments: Gaps, Ambiguities and Overlap

108 Pages Posted: 22 Sep 2016 Last revised: 6 Dec 2016

See all articles by Mark Elliott Budnitz

Mark Elliott Budnitz

Georgia State University College of Law

Date Written: 2016


American consumers increasingly use their mobile devices to pay for goods and services. Technological developments have led to rapid changes in mobile payment products. The law, however, has not kept pace. This article describes the legal framework that applies to mobile payments.

The article examines the three stages of mobile payments: Stage 1 considers the law that applies to consumers who enter into contracts for the provision of mobile payment services. The article first describes the complex regulatory environment in which mobile payments occur. The focus of this part is on consumers who contract online. Stage 2 explores the law that relates to consumers’ use of mobile devices to make payments. Differences in the legal treatment of payments made with credit, debit and prepaid card accounts are analyzed. This part also reviews the law applicable to the many parties involved in mobile payments, including banks, non-banks, wireless carriers, payment processors and third-party service providers. Stage 3 describes problems consumers encounter when making payments with mobile devices, including privacy invasions, security breaches, and unauthorized payments. The article examines the sufficiency of laws consumers can use to remedy these problems.

At each stage, the article highlights the gaps where no law applies, ambiguities where it is not clear whether or how a law applies, and overlap in which two or more laws apply to the same situation or more than one government agency has legal authority over the same type of conduct. The article concludes by discussing the various options available to lawmakers.

Support for this project was provided by The Pew Charitable Trusts. The views expressed herein are those of the author and do not necessarily represent the views of The Pew Charitable Trusts.

Keywords: consumer protection, mobile payments, ebanking, mobile banking, credit cards, banking, privacy, data security, law

JEL Classification: K19, K39, G21

Suggested Citation

Budnitz, Mark Elliott, The Legal Framework of Mobile Payments: Gaps, Ambiguities and Overlap (2016). The Pew Charitable Trusts White Paper, 2016, Georgia State University College of Law, Legal Studies Research Paper No. 2016-22, Available at SSRN:

Mark Elliott Budnitz (Contact Author)

Georgia State University College of Law ( email )

P.O. Box 4037
Atlanta, GA 30302-4037
United States

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