According to data collected by the Pew (News - Alert) Research Center, an estimated fifty-one percent of adults in the U.S. use online banking services to manage their financial accounts. In many cases, those who have chosen not to enroll in online services cite security concerns as a primary factor in determining their lack of participation.
While concerns about internet banking security are valid, FinTech experts like Vladimirs Remi assert that managing banking accounts with online tools is ultimately safe, as long as standard security practices are implemented vigilantly.
In short, the threats posed by online banking are distinct from those posed by traditional banking methods, but that does not make internet banking inherently dangerous. Those who mindfully choose to partner with institutions that are prudent with their cybersecurity efforts in addition to adopting safety-minded practices minimize risk and safeguard themselves against any harmful security breaches.
Is Online Banking Secure?
In many ways, online banking is actually far more secure than traditional banking practices, especially when it comes to the handling of large amounts of cash (as is the case with large physical deposits and withdraws).
As long as you are vigilant about following best practices and you are educated on your financial institution’s procedural safety recommendations, online banking is incredibly secure. If you are feeling uncertain, ask your bank or credit union what in-built security measures they employ to help protect their customers. In most cases, financial institutions are also able to execute additional safety measures to help maximize account safety. These might include daily credit limits, fraud flags, notifications, and regional locks.
Partner with a Security-Minded Institution
Online banking services can only be as secure as the financial institution offering them; that is why it is essential to partner with security-minded banks and credit unions that work whole-heartedly to protect its clients.
The most secure institutions have vigilant measures in place that help to ensure security breaches cannot occur, both internally and externally. These systems work to secure not just the internal process (employees, vendors, systems, and processes) but customer-facing elements as well.
Secure infrastructure, mandatory authentication requirements (including multi-factor authentication), audit trails, secure processes, and continuous communication are all integral elements of any bank’s security initiative. Together, these help keep client’s data safe from cyberattacks and other potential threats that might otherwise put clients’ sensitive information at risk.
When shopping around for a financial institution, Vladimirs Remi recommends inquiring specifically about the bank or credit union’s cybersecurity initiatives and current practices. Choosing an institution that is security-minded and dedicated to protecting your data and assets is the first step in staying safe while banking online. Additionally, many financial institutions offer extensive informational resources for clients wishing to learn more about safe banking procedures and cyber security practices in general.
Best Practices for Banking Online
After confirming that you have partnered with a secure financial institution, much of staying safe online when banking electronically will come down to your own practices and procedures. Most financial institutions have their own recommendations, which Vladimirs Remi recommends familiarizing yourself with. In addition to those standards, the following basic principles are excellent practices when aiming to safeguard your online banking account.
Choose Complex Passwords
It may go without saying for many, but the importance of choosing a complex password can never be understated. In order to safeguard your account against unwanted breaches, craft a strong, unique password. 8 characters or more is the standard, although longer is certainly ideal. If possible, opt to implement a passphrase rather than a single word or series of characters. Additionally, be sure to include numbers and special characters in addition to letters. Using a variety of upper and lower cases is also effective in increasing a password’s overall strength.
Once you have established your password, refrain from sharing it with anyone or storing it anywhere on your computer or mobile device. Be wary of emails and phone calls, even those claiming to be from your bank, which openly or indirectly solicit your password, as these are common scam tactics.
Change Your Password Regularly
It may seem like common sense that a stronger, more complex password is more secure; fewer understand the importance of changing passwords frequently, regardless of the initial password’s perceived strength. This may help guard your account from potential threats in the event of a security breach. Additionally, Vladimirs Remi highlights the importance of using unique, never-before-used passwords in order to maximize your account’s security standing. That way, if one of your personal accounts is hacked, the others are not necessarily at risk as well.
Avoid Automated Login Features
Auto-login saves time and energy, but top experts assert that its convenience is never worth the security risk. Auto-login interfaces work by storing your sensitive data. Should that database ever be hacked or compromised, your sensitive login details will also be made available.
Additionally, opting in on auto-login offerings turns your personal devices into a dangerous liability. If your computer or mobile device is lost or stolen, thieves and hackers will likely be capable of accessing your most sensitive accounts—banking accounts included.
Set Transaction Limits
Transaction limits refer to pre-set caps on how much an individual can transfer or withdraw from an account during any given amount of time (usually a day or a week). Generally speaking, transaction limits are customizable and can be edited or lifted by the account owner at will. In limiting the amount of money immediately accessible, this measure works to limit the damage of any successful breaches, protecting the account owner from losses should the account details be stolen and fraudulently used.