March 11, 2005
Internet Banking Can Be As Safe As Other Forms Of Banking
Statement made by Clayton Wakefield, Head of Technology, Operations and Cards
Minimising the risk of Internet banking will always be a shared responsibility between the customer and their bank. It is no different for Internet banking than it is for any other form of banking, such as using ATMs, credit cards or cheques.
Customers’ responsibilities when banking online include ensuring the computer they use has appropriate security measures, not disclosing usernames and passwords, and avoiding clicking on links with an unknown origin. For its part ASB Bank and BankDirect provide world class Internet security systems.
People who use Internet banking are particularly vulnerable when accessing accounts from third party computers, such as those found in Internet cafes, where they have no assurance that the correct protection is in place.
Internet banking is as safe as any other form banking if customers adopt sensible precautions. Heightened media interest in online banking security has raised a number of concerns for the general public this week. The specific issue regards the risk of criminals gathering information such as online banking usernames and passwords using key logging software.
People who undertake these activities are committing fraud which is a criminal offence. ASB Bank and BankDirect liaise closely with the New Zealand Police E-Crime Laboratory in pursuing the sophisticated criminals who attempt to defraud people online.
ASB Bank and BankDirect have led the way in raising the bar for Internet banking security with Netcode - a two factor authentication security solution. Two factor authentication requires two independent forms of technology to verify a customer is who they say they are - one form they know, like a password, and one they have, such as a mobile phone. It is a similar to using an ATM, where you know your password and carry your card.
Registered Netcode users are texted a code when they carry out applicable pay away transactions, which they must enter online to validate their identification. Netcode was developed with RSA Security, a global expert in this type of technology, and with the endorsement of the New Zealand Police E-Crime Laboratory.
Since the launch in December 2004 over 19,000 customers have registered for Netcode. Our experience is very positive and we believe we have achieved a balance between the current risk of fraud, the cost of the service and inconvenience of providing an additional step in the online banking process. The reaction from customers and appetite for this type of solution has been excellent, so much so that we are trialing additional security systems as a complement to Netcode.
There are a host of tactics used by criminals, usually based overseas, to attempt to defraud customers which include phishing, Trojan horses, viruses and worms. ASB Bank and BankDirect are proactive in developing measures to reduce the risk to customers. Importantly though, customers themselves have a role to play in protecting their assets, just as they would walking down the street with their purse or wallet.