App-Based Banking is the Future – But Is it Safe?

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App-Based Banking is the Future - But Is it Safe?
App-Based Banking is the Future - But Is it Safe? Image source: Pixabay

Brick and mortar banks are gradually closing across the United States as significant numbers of customers turn to mobile banking solutions. According to a survey by Business Insider, 89% of Americans now use a mobile banking app to manage their finances.

Banks are responding to changes and moving with the times. In addition to branch closures, some have no physical branches, operating fully online instead and any newer digital-only banks require clients and clients-to-be to open and access accounts solely via an app.

More Features Mean Greater Risk

Mobile banking apps are convenient, all financial matters can be managed from the comfort of home. Be it paying bills, transferring funds, or freezing and unfreezing debit and credit cards.

Check deposits are supported in many banking apps as well, users take a photo of the check they want to deposit and upload it to the app. All the increased features and functionality mean two things: more data being stored and transmitted via smartphones and, correspondingly, more processes that represent vulnerabilities.

Banks are working hard on cybersecurity to make mobile banking apps as safe and secure as possible. But as technology evolves and apps become more complex, bank security measures inevitably struggle to keep up and loopholes appear in systems.

In late 2016, Accenture and NowSecure, a mobile app security firm, carried out tests on 30 different mobile banking apps. The findings showed that every app tested had at least one security issue from creating world-writable files to broken SSL checks, which can result in sensitive data being intercepted during transit.

Luckily, there are measures users can take to make banking apps safer.

Install Genuine Apps

It may seem like common sense but rogue banking apps that mimic the real deal are becoming increasingly sophisticated. Designed to bypass Android and iOS security features, these apps install malware onto mobile devices, such as viruses, Trojans, and spyware. Although they appear genuine, they were actually set up by fraudsters.

Most banks provide links on their website where customers can download genuine banking apps, either directly or via authorized apps stores. Once installed, users can protect themselves further by keeping the app up-to-date with the most recent security patches.

Protect Devices

The amount of information stored on smartphones is impressive. From social media accounts to emails, documents, and personal health data, there’s enough info that those with know-how can easily benefit while users suffer if access is gained.

Protecting devices with passwords or fingerprint recognition makes identity theft less likely but more than 50 percent of users don’t password-protect their mobile device and less than 25 percent have anti-virus software installed. Without these simple security measures, phones and data are open to attack.

Use Log-in Security

Mobile banking apps require passwords or passcodes for access. In addition, many now use biometrics for identification. Fingerprint readers, eye-scanners, and facial recognition software are extra security measures that ensure only owners are accessing accounts.

As yet, not all mobile devices have biometric functionality but, if possible, users should make use of this advanced technology. Having two or three log-in steps means that if one access method is compromised the account is still secure.

Protect Networks

Wifi security should be a worry for all of us, especially when it comes to sending confidential information via mobile banking apps. Avoiding public and open wifi networks when carrying out transactions helps make banking safer.

Customers can mitigate the risk ever more by encrypting information with a Virtual Private Network. VPN technology can also secure all devices on a home wifi network through dedicated VPN routers.

Banks are continually trying to find and close loopholes in banking cybersecurity. But with technology constantly changing, improving, and evolving, there will always be challenges, especially with attackers looking for new access methods.

By taking advantage of all the security measures available, customers can significantly help make mobile banking apps safer and protect both data and funds from attack.

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