The benefits of mobile banking are pretty obvious; it’s faster, easier and a whole lot cooler. After all, who doesn’t want to be that person in line at a retail store to whip out her cell phone to pay for her new pair of Jimmy Choo’s?
So with mobile banking catching on just as fast as spring fever, why aren’t more people hopping aboard the train? Because there still exists concern over the level of security associated with the technology trend. In fact, according to a recent New York Times blog, a recent Federal Reserve survey found that out of the mobile phone users who haven’t yet adopted mobile banking, about half said it is because they are concerned about security.
“Specifically, consumers expressed concerns about hackers gaining access to their phones and exposing their personal financial information,” Sandra F. Braunstein, director of the Fed’s division of consumer and community affairs, told the Senate banking committee last month.
With this consumer concern in mind, financial institutions all over are grappling with how to create apps that promise the benefits afforded by mobile banking without compromising on security. However, according to industry experts, much of this work is being done behind closed doors which results in consumers fending for themselves when it comes to determining whether their financial institutions’ mobile banking app is safe enough. And with the banks continuing to keep transparency to a minimum, criminals are busy at work figuring out how to crack the mobile banking model.
“We've seen a continued, significant surge in chatter in the underground economy regarding research and development into mobile devices," said Steve Santorelli, director of global outreach at the Internet security research group Team Cymru (News - Alert), in a recent article. "That's for compromise of the operating system, but more importantly, compromise of the app. It took us a generation to persuade people that there's a risk involving malware on desktop devices. Everybody is massively moving towards mobile technology, and that psyche hasn't really yet transferred over to mobile devices. So we need to play a lot of catch up."
With financial institutions embroiled in a busy game of “catch up,” criminals are running rampant as they have figured out that the “mobile” in “mobile banking” provides a multitude of advantages to hackers. This is because in today’s IT landscape, a consumer’s most personal, intimate details are stored on his/her phone, meaning that a simple hacking job by a criminal can leave that consumer hugely vulnerable. Everything you would want to know about a person is stored on that individual’s phone, from contacts to social networks to location to financial institution that he/she uses.
Crooks have already made progress in leveraging mobility to attack mobile banking functionality and commit fraud, according to Jaime Blasco, labs manager at AlienVault (News - Alert).
"The usage of mobile devices to perform financial activities has grown enough to be profitable to the bad guys who target these platforms," he said. "Zeus and SpyEye banking Trojans have adapted their techniques to steal mTANs [Mobile Transaction Numbers] on mobile devices. We see that hackers are adapting their techniques very quickly, and as long mobile banking continues to grow, we will see an increase in these kinds of threats."
With these types of crime spurts on the rise, is it not all that surprising that in the federal survey, which polled 2,300 people in December and January, one-third of all mobile phone users reported that they were unsure of just how secure mobile banking technology was and an addition third viewed the technology as completely unsafe.
So with so many people worried about the security of their mobile banking apps, why then are people flocking to mobile banking quicker than some of the other leading technology trends? Because it affords countless benefits, according to industry experts.
From its ability to allow you to do all your banking paperless to the increased efficiencies it affords, mobile banking is a “must have” technology and, accordingly, people are lining up to download their next app. Specifically, a survey released this month about “attitudes towards online shopping and banking” found that while four out of 10 consumers suspect they are “playing with fire conducting financial transactions online,” they still will not give up their mobile banking apps. And with the numbers of people who are adopting mobile banking creeping quickly into the upward millions, it appears consumers are forking over money to play the mobile banking Russian Roulette game.
Edited by Rich Steeves
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