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How Safe is Online Banking?

With all the services provided online, the traditional bank is becoming obsolete. Opening accounts, applying for loans, and paying bills online are everyday services utilized by a large percentage of the population. As soon as currency can become electronic, there will be lots of real estate out there for sale! But intertwined with the enthusiastic acceptance of internet banking by many, is another group that is skeptical and untrusting. For them, the mantra might be "an online fool and his money are soon parted."

How Safe is Online Banking?

For individuals, there are many software programs that provide personal internet safety. Use of a firewall, pop-up blocker and spyware detector can protect every personal computer if all programs are kept up to date with virus definitions. Everyone should be diligent about keeping security programs current.

Business websites that carry sensitive personal information, particularly banks, require layers of protection including online IDs, passwords, PINs, site keys, and random challenge questions. In addition, banks have computer anti-virus protection and firewalls to block unauthorized users.

Transmission of data information is encrypted or scrambled so only the bank and its customer can see the details. Their customer's financial security is a top priority and all possible security breaches are addressed swiftly.

Online Banking Eliminates Paper Temptation

Online banking eliminates paper, therefore, the temptation for one individual to use it to obtain another individuals personal information and bank account details in a fraudulent manner:

Account statements and cleared checks can be stolen from mailboxes

Checks written out to hired help or cashiers can be used to counterfeit accounts.

Checks enclosed with invoices in return envelopes can be compromised at the processing site.

Online Phishing and Hacking: Justified Concerns?

The biggest worry individuals usually have is someone "hacking" into their online accounts. Banks are extremely security conscious and continually work to protect customers against such activity. As individuals, focus should be placed on applying common sense to protect sensitive, personal information.

Phishing is the most common fraudulent attempt to obtain personal information. It usually arrives in the form of email or instant message. A phishing email may look legitimate, asking for personal information such as social security number, account number, password or pin. DO NOT follow a website link provided on any email, as most legitimate businesses will not include a link or ask for personal information in an email. Instead, go directly to the businesses website and check the URL to make sure it is valid.

Criminals will always be inventing ways to commit their crimes. Online banking provides individuals 24-hour access to their bank and account information, so at least, security breaches can be discovered much more quickly than a successful theft of paper financial information.