Make sure your online banking is as safe as it can be.
Convenience with risk
Online banking is convenient, fast and relatively safe. Banks are working to close their bricks and mortar establishments. As well, banks are eliminating as many humans from banking services as possible. Humans make errors; humans get sick; humans have off days. These are factors which lead to loss of profit in the banks.
Banks without employees
With the elimination of as many persons as possible in banking services, banks aim to increase revenue by reducing salaries. Of course, all bank transactions cannot be done by computers but banks are trying to increase their automated services more and more.
Theft and fraud
Automated banking or electronic banks has non-human problems which can be very serious for the bank client. Stories of people losing money to fraudulent transfers abound. Worse though, many of the people who have lost money this way have not been reimbursed by the banks. In many cases, the non-reimbursement is justified. The client has been careless in allowing people to see their banking password. The client has written their password down and inadvertetnly allowed it to be seen by someone. The client has entered their passcode or pin number in a way that others were able to see. In these cases, the bank was justified in refusing reimbursement.
Online banking safeguards
There are safeguards to online banking which when followed will ensure your financial institution will back you in case of fraud or online theft.
All financial institutions in Ontario belong to an insurance fund whereby money lost by theft is covered and clients receive restitution. Jay Rodriguez of Tandia Financial Credit Union explained that DICO (Deposit Insurance Corporation of Ontario) insures client deposits. Tandia also restricts transfer limits to a maximum of $2500 insuring that clients are protected from devastating losses.
Rodriguez further explains that Tandia protects its clients by requiring they use password combinations which include letters, numbers, characters along with use of upper and lower case changes, making password security even better. Tandia also asks for key pieces of information privy to the client only. Banks have similar password security practices, but the client must practice them. Rodriguez points out that some clients still use PIN numbers such as ‘1234’ which is quite hard to believe, if it weren’t true.
Withdrawal and transfer Limits
Besides transfer limits, banks and credit unions also limit the amount of money a client can withdraw via an ATM. Tandia has a withdrawal limit of $500. However, be aware that some credit card companies have limitless withdrawals or extremely high limits. Tandia adds another layer of security with a wrinkle: on some log-ins the user must answer a personal security question. A certain number of failed attempts locks one out of the account completely for a period of time.
The bottom line with online banking is though banks are trying to minimize and reduce the risks associated with electronic commerce, the ultimate defence depends on the user. Password security is very serious and should be practiced accordingly. Electronic banking clients must use safe practices with their passwords and protect display of these to anyone.
Read more about “PASSWORD USE” in another of our posts. Click HERE.