Internet banking

Online banking is becoming much more common. Internet banking, it's called e-banking or online banking as well, is a technology of remote banking, which allows depositors of the bank to access information about their accounts and conduct transactions using the Internet. It makes your financial life much easier to manage. Internet banking system has been originated since 80s of last century, when the U.S. established systems of Home Banking. In 1995 the first virtual bank Security First Network Bank was created, but it appeared to be unsuccessful. The first bank which reached a success in Internet banking was Bank of America in 2001 year.

Advantages of online banking.
*Convenience - paying your bills online from anywhere 24 hours.
*Ease and simplicity of usage.
*View your transactions online any time.
*Transfer money between accounts much more quickly, and it doesn't depend on the fact has the beneficiary online banking or not.

Disadvantages of online banking.
*Lack of trust. Some people do not trust the services of the bank through the net. Some individuals have issues of trusting a machine, especially in the matters of money.
*In addition to this, a few cases of forgery have been reported in online banking.
*To get the Internet account started, as it requires a lot of paperwork. Some people avoid using Internet banking services because they find it difficult to understand how it works.

According to one of the disadvantages about fraud, banks try to use different systems and mechanisms to ensure and increase the security of online banking. Online banking authentication methods are used to make secure logging in to your online banking account. Types of it are listed below.

Data encryption

Nowadays all or almost all of banks provide Internet banking services using SSL data encryption transmitted from the computer of user to the bank and backwards.

To be able to use advantages of secure data transmission, you should comply with basic safety precautions on the Internet - do not respond to suspicious messages (like it was received from your bank and indeed it wasn't) and do not follow unknown links.

One-time passwords, obtained from an ATM

To enter a system and to confirm the operations inside of account user needs one-time-password except login and password. User can get the list of one-time-passwords at ATM of his bank. From a security standpoint, such system has an advantage - to make transactions via Internet banking a person must at least have the card on hands and know the PIN code to get a list of passwords at ATM. But if you loose the paper with list of passwords you will need to go to ATM to get the new one. The problem can appear also if there are no ATMs of your bank around. That's why banks offer different authentication methods.

If your online banking system provides a list of one-time passwords, try to follow to simple rules. First, try not to lose a list of passwords. Second, do not keep a list of one-time passwords with the username and password from your account (account password is better to remember than to write down).

One-time SMS passwords

Perhaps it is the most common method of user authentication in online banking system. This system requires each transaction via online banking to be confirmed by a one-time password, which you receive in SMS message on your mobile phone. This password is available only for few minutes. In this case your mobile number must be "tied" to the account number. It is very simple and comfortable to use but it is secure. It allows you to protect your account from hackers use - even if the fraudsters get your username and password to log into the system, they will not have an access to your money. Moreover you'll receive information about an unauthorized operation via SMS message.

Do not use Internet banking from your mobile phone. Do not save your account password in the browser. In case of loss or theft of your mobile phone - immediately contact your bank to block your account for online banking.

Digital signature

This mechanism is often used by banks for companies (owners of business accounts), but sometimes it is offered for the individual clients as well. The advantage of DS (Digital signature) is that it allows uniquely to identify the user. In general it is secure method of authentication. Fraudsters can get key of your digital signature, only infecting your computer with computer virus, so you just need to follow some simple rules to protect your computer from viruses.

Do not forget to use anti-virus software and scan your computer regularly to find out and remove all computer viruses. Experts also advise not to leave the key of digital signature attached to the computer, if you're not using it.

External electronic devices for passwords

Some banks offer their clients to buy (or rent) a special device - one-time password generator. The generator is connected to the computer via a usb-port and requires no special software.

Other banks offer to use another type of external electronic device: external electronic password, which is generated when you first connect to the Internet banking system, is saved into external electronic device and then is used for operations in the system. So if you do not have external electronic device with you which has generated password for your account you will not be able to log into it and process transactions.

In addition to all above mentioned features, banks often use additional measures to ensure safety of using the Internet banking:
  • limitation of using a personal certificate - the system allows some banks to use an electronic key (digital certificate) only on the computer on which it was generated. Thereby to make payments through online banking, you can only from a personal computer (though to check bank statement of your account you can use other devices);
  • virtual keyboard - designed to ensure that fraudsters could not steal your registration information with the help of computer viruses when you enter the data with the regular keyboard;
  • limitation of the session duration - in the case of user inactivity, the session in the Internet banking system after a certain time (usually 10-15 minutes) will be closed. After that re-authentication is needed to resume the execution of operations via Internet banking;
  • history of connection or/and logging into your online bank account - thank to this function, the user of Internet banking is able to know if anyone besides him connected to the system, as well as be able to trace all unauthorized transactions if they were performed.

If in some cases you have any concerns that fraudsters gained access to your account via Internet banking, experts advise taking the following actions:
- to disconnect your computer from the Internet network
- immediately contact your bank
- to check your computer for viruses
- to start to use online banking only if you are convinced that the threat is absent
- after all these steps change the password for the access to your Internet banking account.

In conclusion it is necessary to admit that when you use Internet banking to avoid potential problems it is better keep the data access in secure place. Experts advise periodically change passwords for access to the system, it is desirable to do this once in a month and do not use online banking on unverified computers (for instance, computers in Internet Cafes). In addition, caution should be implemented during work on the Internet. You can use the recommendations above. The most common way for fraudsters to steal data is fishing e-mails or fishing messages in the social network, so do not follow unknown or suspicious links. Also fraudsters create false copies of websites for online banking with names very similar to the real, here caution is necessary as well - be very attentive when you enter the website for online banking and your funds will be always safe.

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