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Mobile banking: Tips and tricks for safe transacting

The increasing growth of smartphones nationwide and the boom in mobile phone technology has spurred development of mobile banking applications from third parties, developers and banks.

Mobile banking is growing exponentially, with Berg Insight forecasting that 894 million people worldwide will use mobile banking or related services by 2015. That is up 1,525 percent from the 2009 figure of 55 million users of mobile banking services in 2009. 

As mobile banking increases in popularity, safety and security of information rank at the top of the list of consumer concerns.

In a recent survey from KPMG, more than 50 percent of respondents noted that concerns on security and privacy are the primary reasons for their lack of confidence in mobile banking. 

To bank with confidence from their mobile phones, consumers can adopt a variety of measures to protect themselves against security risks.

Verify authenticity of bank’s software
Before installing your bank’s software for mobile banking, it is essential to ensure that the software is authentic and is also the latest version released by the bank.

As more third-party developers build applications for mobile phones, it is becoming harder for consumers to separate legitimate software from fraudulent ones.

It is advisable for consumers to contact their banks for confirmation before installing any electronic applications on devices such as mobile phones and laptops.

Manage passwords
Ensure that your mobile phone is protected with a password, and that the maximum number of incorrect password submissions is set to no more than three.

To do this, go to your phone’s security options or tools section. This security mechanism allows you to protect data in case you lose your phone.

Once the number of tries has elapsed, the next entry will result in the phone being formatted and all installed data wiped out as a security measure.

It is also a good idea to choose a complex password with a minimum of eight characters using letters, numbers and special characters such as the hash, asterisk and exclamation marks.

Do not use personal details such as date of birth or names in any form as your password or even as a part of your password.

Change the default password or access code that is provided to you by your bank to access your account.

Thereafter, change it regularly, and do not repeat the same password – or even variations of the same set of characters – frequently.

Sound security policies implemented by banks will usually prevent you from reusing passwords too frequently.

Protect your personal information
Along with setting passwords, it is essential that consumers do not reveal or write down this important number.

You should not retain any email or paper communication from your bank with regard to your password or other personal access details, either.

In addition, you do not want to give your password, PIN or identification information over the phone or Internet or share this number with anyone.

In addition, avoid storing sensitive information such as credit card data or your mobile banking password and user ID details in a separate folder on your phone.

Review account statements
When using mobile banking solutions, it is a good idea to review your account statements frequently.

You will want to be sure there are not any fraudulent transactions that you did not make or authorize.

If you do notice any unusual transactions, call your bank immediately and dispute the transactions.

Retain physical copies of receipts, if any, just like you would for your credit card transactions. They may be helpful in tracking and reversing fraudulent transactions.

Lost your phone? Report it – now
Lastly, if you lose your phone or it is stolen, you will want to call your bank and arrange to deactivate your mobile banking service.

This step will prevent anyone who finds your phone from accessing your bank account.

As companies work to extend the reach of mobile banking throughout the world, consumers should keep in mind that, as with any technology transmitting sensitive information, precautions should be taken to ensure user data remains secure.

By following the above steps, consumers can feel confident in maintaining their privacy when using mobile banking solutions.

Abraham Punnoose is vice-president of corporate strategy for marketing and business development at Roamware, San Jose, CA. Reach him at
[email protected].