Is Online Banking from Your Smart Phone Safe?

The popularity of online banking has risen sharply in recent years. Over two-thirds of Americans depend on digital banking to some degree. There is a number of reasons online banking has become so popular, but convenience is at the top of the list.

Financial institutions are offering mobile banking services to ensure even more convenience. Mobile banking channels have become popular, with 26% of customers using them more than brick and mortar and desktop banking solutions.

However, some customers are wary of connecting to their online banking platform through their mobile device. Is accessing your online banking account through your smartphone or tablet actually safe?

Here’s what the research says.

Customers remain concerned about mobile banking. But data shows these fears are mostly unwarranted

Despite advances in digital banking solutions and new cybersecurity approaches, many customers are still concerned about the safety of using their mobile devices to manage their accounts. A study from the Federal Reserve found that 73% of customers that were reluctant to use mobile banking cited security as their number one reason.

Although customers are understandably concerned about safeguarding their online accounts, fears about mobile banking security are overblown. The truth is that mobile banking is pretty safe. Only about 3% of all security breaches have involved mobile banking data.

Nevertheless, mobile banking customers must take reasonable measures to contact themselves.

What should mobile banking customers do to protect themselves from hackers?

Mobile banking security breaches may be uncommon, but they are not unheard of. You shouldn’t be alarmed, but you should also not be lulled into a false sense of security either. You should take the following steps to protect yourself from mobile security risks while using your digital banking service.

Be very careful with mobile apps

It is surprising how people throw caution to the wind when downloading applications for their mobile device. Most people are pretty conservative about downloading programs for their desktop computer. However, those same people rarely think twice before installing a new app on their smartphone or tablet.

People often assume that an app is safe, simply because it was on the App Store or Google Play. This is a terrible assumption!

Just how vulnerable is your mobile device when you install apps without doing your due diligence? One study from Gartner found that 75% of all mobile security breaches are caused by misconfigured or maliciously designed apps.

Even more concerning is the shocking number of apps that meet this profile. NowSecure conducted a study that found that around a quarter of all apps are unsafe to use.

I can’t overemphasize the importance of researching mobile apps before using them. You should only download apps from trusted publishers and make sure that any missed configurations have been resolved.

Take advantage of your bank’s free security software

Mobile security tools are not usually free. However, some banking providers offer them for free to their customers.

Why would they do this? They don’t want to be liable for financial losses that arise from an online security breach. They also don’t want to deal with the damage to their brand either. Providing digital security tools is a much cheaper alternative.

Find out if your bank offers them. There is no reason not to install them if they do.

Use a strong PIN password for your mobile device

Hackers don’t always use an ingenious brute force attack to get access to your online profiles. They often breach your security by simply stealing your phone.

If you don’t have the right security settings on your phone, then there will be nothing to stop a smartphone or tablet thief from finding all of your profiles. At that point, the only thing that stands between them and your banking information is your password. If that is breached, then it is game over.

Be careful logging into hotspots

You need to be careful about using hotspots to get access to WiFi. Hackers often create bogus hotspots to trick people into sharing information. If the hotspot isn’t secure or trusted, all the information that you share over it could be at risk.

Some hackers disguise their honeypot hotspots to look like legitimate ones. If you go to Starbucks, they may have one that looks like it belongs to Starbucks. Make sure you ask the café or airport what the name of the hotspot is and be cautious not to log onto another by mistake.

Don’t use autofill passwords

Most mobile devices let users automatically fill in their passwords. This is not a smart thing to do with any website, but it is particularly risky with online banking. If somebody gains access to your phone, then they can simply fill-in the password and have complete control of your online account.

Yes, this means that you’re going to need to manually enter your password every time that you want to login. However, the extra hassle is worth reducing the risk that your account will be compromised.

Be aware of social engineering scams

Do you remember watching Hackers with Angelina Jolie back in the 90s? You would probably think that all hackers use sophisticated technological exploits to penetrate the systems they target.

This stereotype can leave your online account vulnerable. In 2018, hackers often employ a number of social engineering strategies to dupe their victims into revealing information that gives them access to their accounts.

There is a number of ways that hackers can try to trick you:

  • They may call or email you pretending to be a representative from your bank. They may tell you that your account has been locked and you need to provide your old password so they can reset it. They may even repeatedly enter the wrong authentication information so it actually does get locked to make the story seem more reasonable.
  • They could pretend to be a government agency sending information that you need to fill out a form. This could require you to download a document with a keylogger, which lets them track your keystrokes when you try to access your account.
  • They could pretend to be a brand offering a reward. In order to get the reward, you need to answer certain questions, which may reveal the answers to your security questions on your online banking account.
  • They may pretend to be somebody you work with that needs information. If they found out that you work with a large organization, they may pretend to be somebody from payroll that needs your banking information to process online payments.
  • You should be very careful before giving any information to somebody over the phone, email or text. Keep in mind that hackers can do a tremendous amount of damage with even a small amount of personal information these days.

Mobile banking is safe, but you must be cautious

A growing number of people are relying on mobile technology to handle their banking. In general, it is pretty safe. However, you must still be careful to prevent hackers from taking control of your account.

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