Consumers more wary of e-banking

E-security fears are putting people off e-banking, according to a new survey

Fears over phishing and identity fraud are putting many people off internet banking, a new report from security specialist RSA Security has revealed.

Forty-three percent of UK respondents to the Consumer Online Fraud Survey said that online threats had either stopped them from signing up for internet banking, or, in the case of those already signed up, had made them less likely to use the service.

Almost four-fifths of respondents wanted banks to provide better risk-based authentication services, involving behind-the-scenes analysis of transaction behaviour, to help limit the potential threats. Two-factor authentication systems, which require a physical token and a username or password, were less popular. Just over a third wanted to see such systems introduced.

David Porter of fraud prevention specialist Detica warned that more overt security measures were no panacea.

“The question is what one deems an acceptable level of fraud prevention,” Porter said. “There is always a trade-off between security and convenience, and paradoxically if security measures [are increased] it can encourage more risky behaviour from consumers.”

Porter added that two-factor authentication systems would have more chance of wide-scale adoption if they were embedded into other devices such as mobile phones.

Mobile banking could also become a major security concern this year. A separate report released last week by consultancy Tower Group warned that online criminals will increasingly target mobile phone banking, as new payment initiatives in the mobile channel take off.