1273616 - Rajat kumar, F2, Q19 - Is mobile banking more secure than online banking?

Mobile Banking Is More Secure Than Online Banking                                 

INTRODUCTION

Online Banking:

                           Online banking (or Internet banking or E-banking) allows customers of a financial institution to conduct financial transactions on a secured website operated by the institution, which can be a retail bank, virtual bank, credit union or building society.

PROS:

1. They tend to offer higher interest rates than local banks due to lower overhead costs such as paper mail, lease and other real estate expenses.
2. Some banks offer customer service available 24/7 or till late evening hours.
3. You can quickly initiate transactions online such as a transfer, withdrawal request or a bill payment in a matter of minutes.
4. Most paperwork can be filled out on the computer and transmitted electronically.
5. You can set up alerts so the bank will let you know when your balance is low.
6. Less paper mail such as bank statements and utility bills will decrease the amount of paper trail left behind for identity thieves.
7. No Fees- The majority of online banks do not charge fees. HSBC for example has no monthly fees and no minimum balance requirement for their online savings account.

CONS:

1. Limited Access – you can’t just drop off your deposit like you would at a local bank. It must be mailed or transferred from another account.
2. At some online banks, the customer doesn’t have the opportunity to get to know the staff. Calls are often handled through a random system where you will get to speak to different customer representatives every time you call for an issue.
3. Make sure you select a bank with many ATM’s available; otherwise you will end up paying fees for using machines not part of the bank.
4. It takes longer to clear a deposit.
5. Paperwork requiring signatures has to be done through mail, taking longer to process.
6. Your bank’s website can go down, limiting access to accounts temporarily

Mobile Banking:

                               Mobile banking is a system that allows customers of a financial institution to conduct a number of financial transactions through a mobile device such as a mobile phone or personal digital assistant. Mobile banking differs from mobile payments, which involve the use of a mobile device to pay for goods or services either at the point of sale or remotely, analogously to the use of a debit or credit card to effect an EFTPOS payment.

PROS:

• Very convenient.  Online banking is a totally easy thing to do.  In the comfort of your home or offices, you can do whatever monetary transactions you wish to do with your bank.
• Unlimited service day and night. The services and various features of your bank are always available seven days a week and 24 hours daily. The most interesting thing here is that, everything can happen at just one click of your mouse.
• No time constraint. Online banking is also stress free because it never closes unlike the traditional banking that has cut-off time.
• Easy to access via PC. Using your personal computer, you can easily do various transactions with your bank in view of your business or any other personal or financial matters.
• Easy way of payment. Bill payments can also be handled properly and smartly.  Instead of waiting for certain due dates, you can easily pay all your transactions using your computer and in coordination with your bank.
• Smart.  Online banking is also ubiquitous or simply put smart.  This enables you to do troubleshooting regarding any problem that may arise from your business.
• Higher interest rate. Another great advantage of online banking is the interest rates which basically range between 5% to 3.40% annually.   Unlike the traditional banking, online banking can earn you a better interest or return of investment both in your savings and checking account.
• Easy transaction. Another advantage is the speed of every transaction.  Online transactions, compared to ATM or traditional banking, works faster.  Thus business matters could benefit so much from this speed feature.
• Banking online is both efficient and effective.  With just one secure site, all your financial transactions can be managed orderly.

CONS:

• Slow processing: The moment you entered a financial transaction with your bank via the computer.  Usually the bank will require you to submit certain documents like an identification card, signature and the like.  Not only will the bank online require you to submit documents but also to provide special power of attorney in cases where you want to do transactions together with your spouse.  A concrete example is when you want to manage all your wealth and resources together as a couple and you wish to view it online.  Certain technical procedures regarding online banking may be taxing too and complicated.
• Learning curve: Banking online especially in locating the sites may be complicated and hard to find.
• Bank site changes: The bank will require you to re-enter all your information again and other related data.
• Trust aspect: Online banking should be entered very carefully if you wish to enjoy your financial life.

DISCUSSION

Mobile Banking Is More Secure Than Online Banking (Daffern, 2014)

Accessing your bank’s mobile website or using your bank’s mobile application to access your account is much more secure than conducting traditional online banking on your computer. Pro or con?

Pro: Smartphone Tech Reduces Risks

Mobile banking is on the rise, and chances are you’re one of the 52 percent of consumers who have accessed some form of mobile banking in the past six months. Yet perceived security risks remain a hindrance to full adoption of the technology. In truth, accessing your account via your bank’s mobile website or using your bank’s mobile app is as secure, if not more secure, than banking online via PC. Why?
People always know where their phones are: Studies by Morgan Stanley have shown that the average American (91 percent of those surveyed) has his or her cell phone within arm’s reach 24 hours a day. Think about the last time you lost your wallet or credit card. How much time passed before you noticed? Your mobile phone is always on and available.
Your mobile banking “identity” is tied to a specific phone: Done correctly, your mobile “identity” can be linked to a specific device, making traditional “man in the middle” security compromises much less relevant.
Consumers can mitigate fraud in real time: SMS (short message service) and push messages for smartphones allow consumers to help banks monitor for fraudulent transactions as they happen.
Geolocation helps curtail fraud: Smart mobile companies are leveraging the GPS capabilities of smartphones to stop fraud before it happens. If a physical credit card is used hundreds of miles from a phone’s location, for example, chances are that one or the other has been stolen.
Future biometric-based security: New smartphones are already being released to leverage this sort of capability. The newest version of the Android mobile operating system, Ice Cream Sandwich, uses facial recognition technology to unlock a user’s phone. And Apple’s introduction of Siri on the iPhone is setting the stage for voice recognition capabilities to come.

Con: Your PC Is More Trustworthy

While the mobile platform has many features with the potential to facilitate a safer remote-channel experience over time, today’s online channel typically offers more in the way of robust security. Much of this is the product of necessity: Online banking has been around a lot longer than mobile, offers more transactional capability (much of it higher-risk), and has been much more intensively targeted by malware and other cyberthreats. As a result, online banking platforms are typically more mature in their defenses than are mobile platforms.
Another factor that adds to the risk of mobile banking is consumers’ failure to treat their smartphones like tiny little computers. Few consumers have any form of anti-malware software on their mobile devices and, with little consideration for security, many are willing to download apps of completely unknown provenance from app stores.
Risk executives at financial institutions expect mobile banking to come under more intensive attacks as enhanced transactional capability is deployed to the mobile channel. Aite Group surveyed global risk executives in November 2011 to determine the extent to which they plan to bolster the defenses of the mobile channel over the next two years. Ninety-two percent of respondents expect to deploy increased fraud prevention technology. Sixty-seven percent have projects under way, and 25 percent are waiting to see what kind of threats emerge.
Mobile banking is viewed as a critically important strategic channel by most financial institutions. In order to ensure a secure experience for everyone, the protections must increase alongside the risks.
(http://www.businessweek.com/debateroom/archives/2012/02mobile_banking_is_more_secure_than_online_banking.html)

Is Banking on Your Smart Phone Safe? (Martin, 2014)

If you live life on the move, then mobile banking can seem like an ideal way to keep track of your finances. But is it a safe way to manage your money?

The advent of smart phones means that you can now access your bank accounts whenever and wherever you are – but are you leaving yourself open to fraud and loss when you do so?

Is it safe?

Firstly there are various types of ‘mobile’ banking and each comes with associated risks.

Text update facilities, whereby you receive notifications of your balance or a mini statement in the form of a text, pose little risk as they don’t actually provide direct access to your accounts. As such there is little a potential fraudster can do with this facility alone.

However, there are other forms of banking using your smart phone that do provide you – and anyone who accesses your phone - with direct access to your bank accounts.

For example First Direct allows smart phone users to log into a full version of their internet banking site using a smart phone. While others provide banking apps that let you manage your money via your mobile.

At the moment banking on most smart phones is relatively safe – as long as you take the necessary security precautions – as they will only allow you to run one application at a time.This means that while you are using your mobile banking application there is unlikely to be another program (like a virus or other malicious software) running in the background, accessing the internet and posing a security risk.

However, as phones become increasingly sophisticated and more like regular computers, the safety of mobile banking is getting to be a bigger concern.

Phones that allow you to access multiple applications simultaneously (like the iPhone4) pose the biggest risk when you use them to access your bank accounts. This is because with multi-tasking comes a greater chance that malicious software could be running in the background without your knowledge.

  (http://www.money.co.uk/article/1005729-is-banking-on-your-smart-phone-safe.htm)

My views:

Mobile banking and online banking both are secure but mobile banking is good for accessing bank account on your finger on the go. Mobile banking have many additional features and benefit against online banking.

Conclusion

So the conclusion is mobile is secure as computer but it make more useful by using in mobile rather than computer.

• It’s convenient
•  Easy accessible
• 24 hours on the go
• People friendly