Tuesday, November 24, 2009

Banking by Phone: Convenient and Safe?

WITH THE introduction of an iPhone app that lets you deposit a check by taking a picture of it, options for mobile banking are growing. And though you might think the boost in convenience comes at the expense of security, banking on your phone can be safer than using your PC if you take basic precautions. You have three options for mobile banking: downloading a program for your cell phone, using your phone’s browser to access a mobile version of your bank’s site, or simply sending an SMS message.

Downloadable programs vary, but an iPhone app from USAA is at the cutting edge. Qualified USAA customers (limited to credit-approved military personnel) can use it to make deposits by taking a picture of a paper check, which they then void and toss. But while the USAA app allows for sending money to a predefined payee, it doesn’t let you create a new payee (though you can do so on the USAA Web site). It’s a common restriction among downloadable apps, intended to prevent someone else from grabbing your phone and sending themselves your cash. Online banking via a phone’s browser generally offers all the same options as on a PC. Both downloadable apps and mobile sites typically require logging in with the same user name and password you’d use on your PC. They also encrypt communications to and from the bank. SMS messages are the least secure method, as SMS doesn’t normally use encryption. This option is also limited. Wells Fargo’s SMS service, for example, allows only for low-risk activities such as checking your balance or finding an ATM. Using any of these options on a device you might easily lose may seem inherently insecure. But any phone option is largely safe from malware, one of the biggest threats to online banking. Also, the variety of mobile operating systems and other factors mean that, for now, you have no real risk of leaving your phone open to baddies. Tom Wills, a senior analyst for Javelin Strategy and Research, says mobile banking can be safer than banking on a PC—as long as the phone’s security features are enabled. Because your phone may someday end up in the backseat of a taxi without you, those precautions go beyond the ones you’d use on a PC.

Practice Safe
Mobile Banking Using a PIN or a password to lock your phone is the first step; just knowing which bank you use can help a potential ID thief. Next are remote-wipe options that let you clean out your phone should you ever lose it. Wills says some banks offer the feature for their downloadable apps. You can wipe BlackBerrys and iPhones (if you pay for the MobileMe service), too, and some apps such as Kaspersky Mobile Security offer the feature for Symbian OS or Windows Mobile phones. Finally, SMS messages can provide security support if you instruct your bank to text you after large or potentially suspicious transactions. Considering how much personal info most people keep in their e-mail, losing your phone can be a risk even if you don’t use mobile banking. But the combination of power-on passwords and safeguards from the banks can make mobile banking just as secure as it is handy.

Source of Information : PC World November 2009

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