Rapid Growth in Mobile Banking Increases Security Risks

  • Fraud Prevention, Security

As mobile banking continues to grow in popularity, financial institutions and businesses are reassessing the risks that come hand in hand. Despite the new risks, the number of online bankers continues to rise due to the convenience and sheer number of mobile users. Bank of America has reported that mobile bankers have increased by 3 million in just the past 12 months. This now leaves them with a mobile banker base of about 10 million. Banks have started to implement fraud prevention measures involving mobile banking, but have not quite perfected it.

One of the biggest mistakes that financial institutions are making in regards to their mobile security, is that they are being reactionary. Banks may create a security strategy that outlines protocol if personal information is hacked via mobile phone. What they need to be switching their attention to is not what to do if this happens, but how to detect and prevent this from happening. Mobile security needs to have a preventive nature that will stop the fraudulent activity from affecting the user or bank. Financial institutions also need to take into consideration that even though mobile banking and mobile payments are often connected in one way or another, they are not always one in the same. By mapping out/predicting the risks at hand, banks can anticipate potential issues and pinpoint any gaps in the security.

Banks need to invest in outside vendors and in internal efforts to predict and prevent potential mobile fraud. By integrating identity verification and authentication as a part of mobile security measures, companies will be able to better prevent fraud from being executed.

[Contributed by EVS Marketing]