When you bank online, you trust that your account is safe from hackers. Even so, online accounts can seem to consumers like easy targets. Instead of robbing a bank, a criminal could simply whisk away your money with a few keystrokes. Learning how to have a safe online banking would help you to protect yourself from such cyber crimes.
To combat these concerns and protect your cash banks and credit unions have a number of policies to keep online customer accounts secure. Standard measures include using firewalls, anti-virus protection on bank computers, fraud monitoring and website encryption, which scrambles data. So only the intended recipient can read it. If you bank online, chances are your financial institution employs these security measures.
While online banking is convenient, it doesn’t come without its fair share of risks. Your identity and bank account information can be compromised if you’re not careful. The next time you decide to log in to your online bank account, keep these tips in mind.
So Is Online Banking Already Safe?
Online banking is safe when secure bank technology on the back end is met with alert consumers on the front end. As an account holder, you have a role in making sure accounts are protected.
Don’t respond to emails that seem too good or bad to be true.
Large-scale data breaches get the headlines, but criminals also work on a smaller scale by attacking consumers directly. For example, fraudsters often use so-called phishing scams, in which they send out emails pretending to represent a financial institution in the hopes of hooking an unsuspecting consumer.
The email might suggest there’s a problem with your account and ask for your bank password or Social Security number. Or it might say you won $100 million, but your account information is needed to wire the funds. If you reply, the criminal could use the information to illegally make purchases or withdraw money from your account. So please, do not respond to emails that are too good or bad to be true.
Online Banking can Change into Bank Hacking
With its increased usage, however, online banking is becoming an increasingly attractive target for hackers. In fact, over the recent years, major banks have been the prime targets of hacking attacks. Citigroup revealed that in 2011 more than 360,000 accounts were compromised in a hacking attack that left 3,400 accounts suffering losses of up to $2.7 million.
In September 2012, Iranian hackers were reportedly targeting Citigroup, Bank of America and JP Morgan Chase. When the hacks were finally reported, we learned that the attacks had been going on for close to a year even though customers have been complaining about how difficult it was to access their accounts.
More recently, McAfee Labs reported that hackers are planning to take millions from customers of major banks starting in the spring of 2013. The plan has been called Project Blitzkrieg.
And more recently, our phones are being used by hackers to access our bank accounts.
All of these highly publicized attacks raise a lot of concerns for me, not the least of which is the safety and security of our online banking transactions. Should you pay your bills online? Should you check your balance from your bank’s website? Or should you transfer funds online?
For me, the answer is yes. Here’s why.
Online banking is safe for consumers
Banking websites are hit by hacking attacks every single day. While that may be unsettling to hear, there is a silver lining. As a result of these attacks, banks continually improve their systems to effectively deal with such attacks.
In addition, even if hackers are able to steal money from your account, you will likely be protected. If you safeguarded your personal information and reported the loss immediately, the bank is likely to reimburse your account, according to Bankrate. According to the same source, federal law provides that banks must reimburse stolen funds if reported within 60 days.
Take note that this does not apply to institutional depositors. So, if your bank account is under your business name, then you are not covered by this protection.
This does not mean, however, that you should just be complacent. Online banking is safe, but you should also exercise caution when banking online. There are best practices that you should observe when you use any online banking service.
First, though, you should understand the risks of online banking.
Online Banking Risks
There are four main types of attacks that are prevalent when you use online banking services. Let’s see what are these 4 main types of attacks.
Having an online banking account, you might fall victim to phishing. This tactic generally involves tricking somebody into clicking a link in an email message. The link often downloads software to a computer that can be used to gather sensitive information such as usernames and passwords.
Alternatively, the link may take a user to what looks like a legitimate website. Once there, the website asks for confidential information that can be used by hackers to gain access to other accounts, such as email.
2. Identity Theft
Even if hackers do not steal from your account, you can still have your account details compromised in the case of an identity theft. This includes your personal information, such as your social security number and other identifying data. These data could be used to hack into your other accounts.
Identity theft can occur in a variety of ways. Online your social security number and other confidential information can be compromised. As noted above, a phishing attack is a common method used by thieves.
Offline, however, your identity can be compromised, too. Whether it’s digging through trash or stealing your wallet, thieves have several ways to access confidential information. Therefore, it is essential for you to protect your online privacy.
If you access your online banking site on public networks, such as Internet cafes or public Wi-Fi, there is a chance that you could fall prey to keylogging. Keylogger is a software recording your keystrokes and using these logs to get your account details. Keylogging may also be carried out using video cameras that record your keystrokes.
This might be a little more difficult for hackers to carry out, but it does happen. Pharming occurs when hackers are able to hijack a bank’s URL. So that when you try to access your bank’s website, you get redirected to a bogus site that looks like the real thing.
How to Keep Your Online Banking Secure?
So how do you deal with all these risks? These steps should ensure that you have adequate protection from falling victim to these hacking tactics.
1. Frequently Change Your Passwords
I get it, it’s really irritating to change your passwords over and over again. You’re probably thinking that it’s bad enough that you have to incorporate a series of numbers, capital letters, and symbols in your password, and now you have to change it all the time? But seriously, having a complex and frequently-changed password will help protect your account from hackers.
If you’re worried about forgetting your password, then you should consider using a password manager to securely store all of your passwords. With password managers, you won’t have to go through the hassle of resetting your password ever again.
2. Never Use Public Wi-Fi
Public Wi-Fi has a ton of disadvantages. Not only is it usually slow, but it sometimes doesn’t provide a secure internet connection. When a hacker taps into public Wi-Fi, they can see everything, including your bank account login.
However, encrypted webpages can save you from the prying eyes of hackers. Make sure to check if your bank’s URL starts with “https://” not “http://” The “s” tells you that the page is safe to use.
Even if a page has encryption, it’s still better to avoid public Wi-Fi altogether. Using a virtual private network (our top recommendation is ExpressVPN, which is discounted if you sign up using this link). Or using your cellular network to access the internet is far more ideal when dealing with online banking. If you really want to play it safe, just access your account from your own home’s Wi-Fi. Also you need to keep in mind that it is essential for you to secure your Wi-Fi router from hackers, too.
3. Enable Two-Factor Authentication
Most banks will give you the option to enable two-factor authentication (2FA). While 2FA has its strengths and weaknesses, it still gives you extra protection for your sensitive account information.
When you sign up for 2FA, you’ll typically receive a text message with a one-time password every time you log in to your account. It might seem like an inconvenience to go the extra step, but it’s worth it.
If a hacker tries logging into your account, you’ll get a text with a code. Once you realize that you didn’t make this request, you can intercept the hacker right away.
4. Don’t Open Any Suspicious Emails
Emails that ask for your personal information are called phishing emails. These emails try to trick you into divulging your bank and credit card information. The emails may look like they come from a legitimate source, but the person on the other end of that message is almost always a hacker.
Just remember that your bank will never ask you for personal information through email or text message. If you ever receive an email or text from a “financial institution” that seems a bit too nosey, make sure to report it to your bank.
5. Avoid Using Automatic Login
With automatic login, your browser saves your username and password, allowing you to access your bank account without remembering any of your login information. While that’s convenient and all, it’s not the safest thing to do.
You should avoid automatic login at all costs, especially if you use your phone for online banking. What if someone happens to swipe your phone? They won’t even need your username or password to get into your bank account.
If you haven’t already, disable this feature on your phone and on your desktop right away!
6. Use the Mobile Banking App
Download your bank’s mobile app, and use that instead of accessing it from your desktop. Unfortunately, computers get hit with the most malicious attacks.
While every single device has the potential to get hacked, it’s just not as common for mobile devices. Accessing your cellular network and logging into your bank account will give you the most protection.
7. Update Your Computer and Mobile Device
Updates can sometimes take several minutes or hours. So it is clear why you’d put them off. However, if your computer or phone is months or years behind in terms of updates, you won’t have the latest protection against security breaches and malware.
8. Secure Your Mobile Device
Don’t forget to utilize all of your smartphone’s security measures, especially if you’re a fan of mobile banking. Make sure you can lock your phone with a pin, facial recognition, a pattern, or a fingerprint and other biometrics securiy. If your phone ever gets stolen, it’s more difficult for the culprit to get into your phone.
9. Sign Up for Text Alerts
If your bank gives you the option to get text alerts about your account, don’t hesitate to sign up. Every time a large sum of money is drawn from your account, you’ll get a text. Hopefully, you’ll only get texts when you’re the one taking out cash.
Text notifications allow you to pounce on any suspicious activity in your bank account. If you receive a text that your balance has suddenly dropped, and you haven’t made any transactions, you can contact your bank and quickly put a stop to any fraudsters.
10. Keep an Eye on Your Statements
Finally, in this step you should take a closer look at all of your monthly bank statements. Your bank might overlook fraudulent activity on your card, and fail to alert you. By going over your statements, you can scan for any strange transactions. If you do happen to find any, you must contact your bank as soon as possible.
Smarter and Safer Online Banking
Although online banking can potentially lead to hacking and fraudulent charges, using these above practices will help you avoid any problems with your bank account. For safe online banking, you just need to use your common sense. If an email seems sketchy, or a network doesn’t seem that secure, go with your gut and avoid it.