Addition of a multi-factor authentication feature
A single password is submitted before access is granted to a bank account. This is a guarding system that is weak and should be reinforced by adding a combined authentication attribute. There are three categories of factors that matter which are the knowledge factor (something you know), inherence factor( something you are), and possession factor(something you have). Multi-factor authentication combines two or more of these factors. The knowledge factor involves the use of passwords, OTPS, and PINS. For example, where a person swipes a debit card and enters a PIN. The possession factor is all about sim cards, smartcards, and smartphone OTPs. The inherence factor involves biometric verification or the biological traits applicable for login. for example fingerprints and facial recognition. These are all measures to add a security layer to make it less accessible.
Usage of near-field communication SIM cards
It is a technology that is used to contactless exchange data over short distances. It is the exchange of data over two devices connected nearby just like credit card transactions. It authorizes customers to download credit info into another closely SIM card. This can be suggested to customers as a security measure. This form of transaction, mobile banking, is to secure the consumer’s financial account information from being compromised.
End-to-end encryption
Sensitive Data is being exchanged in online transactions which have become a playing field for hackers. This data however can be secured by the use of end-to-end encryption. It is a secure communication process that ensures third parties from getting data transferred from one endpoint to another. It means that the process uses encryption keys to scramble data so that only authorized parties can have access to it. This involves the administration of security audits as well as carrying out penetration tests to ensure top-notch security.
Biometric identification device
The initiation of fingerprinting devices in mobile banking is an added security measure. It acquires a variety of signals such s location, PIN code, IP address, time of the day, etc. financial institutions need to develop apps that have a fingerprint feature compatible with the consumers’ mobile phones to add a layer of security and prevent compromising financial accounts.
Offer immediate text and email alerts
The assumption is made that a person who uses mobile banking has direct access to their texts or emails. Banks should send a concurrent text or an email alert to caution a consumer of any bank transaction to prevent fraud and identity theft. It is similar to when one can log in to someone’s Instagram account and an email is sent to verify if it’s you. Banks program their apps to do the same. This security feature allows a customer to know when a certain amount of money has been spent.
The development of paperless banking
With the evolution of technology, many sectors have conformed to digitalization. The banking and financial sectors can now do all the processes paperless. It can include the opening of a bank account, money transfer confirmations, and account activation process as well as handling online transactions. Financial institutions should develop apps that allow for all these processes while ensuring security. Digital platforms enhance efficiency hence quick and easier to use.
Usage of behavior analysis
The technology has provided special software on retail which monitors & analyzes the banking activity of consumers done on their online accounts. This technology pinpoints abnormalities such as odd behavior, errors in business, or even unauthorized access for investigation. A text or email can be sent to the customer informing them of suspicious activity on their banking accounts for further investigation.
Safe digitalized documentation
Safe digitalized documentation is another way to increase the security of a mobile banking app. This involves setting up electronic signatures in various sectors such as eCommerce and call centers. It benefits customers with mobile banking services since a large portion of documents is on mobile. It can be achieved by the use of e-vaults or free cloud storage to store the most important financial documents.
DigiLocker can also be used which requires an Aadhaar card that is linked to your mobile number. The locker is a repository for e-documents. Banks can acquire an e-locker where customers can access bank accounts information through their mobile phones on the internet.
Use secure access
The use of a secure internet connection can protect a customer’s account information against data theft and fraudsters. Mobile banking comes with increased security risks and vulnerabilities despite the customer’s want of a convenient banking app. Financial institutions should incorporate new technologies and supple development processes to improve their security. The technology ensures a strong authentication of mobile banking solutions. Financial institutions should also educate customers on the new technologies and what risk they face against hackers.
PSD2 regulations
Payment Service Providers Directive is a regulatory framework that ensures payments across the EU are easy, secure, and efficient. These regulations tackle banking security issues by adopting new and improved technology. They provide a defense mechanism against fraud, increase digital security as well as strengthen the usage of digital documents. PSD2 allows financial institutions, banks, corporate firms, and clients to work with banks closely by supporting the idea of open banking mobile technologies. The law focuses on improving online security and improved customer experience.
Educating the customer
Managing financial security involves educating your customers on financial fraud. Banks should create awareness, for example using pamphlets and advertisements, and encourage customers to take precautions. Some of the insecurities that they should be aware of include making transactions using public wifi hotspots and authorization flaws in business logic. Financial institutions, especially those offering mobile applications, should educate customers of such insecurities and introduce them to the new and better technologies which are secure.
Conclusion
The use of mobile applications and online platforms has made banking services and financial transactions convenient for consumers. The threat of hackers still exists and therefore, it is the role of these institutions to take security measures. The implementation of online security measures should be done as well as the adaptation of secure new technologies. Applications require encryption keys, evaluation, and notification to customers in case of any suspicion to minimize the security risks in financial institutions.
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