A new Impact Report from Aite Group, LLC investigates security vulnerabilities for mobile banking, both now and in the near future, focusing on the methods that are being deployed to mitigate risk over this emerging channel.
Mobile banking is the first in a variety of mobile information and transaction services that will be gradually expanded over the next few years by financial institutions and mobile operators alike. The wireless networks are finally capable of delivering broadband speeds over handsets, which now have computing power equivalent to personal computers of less than a decade ago.
However, it remains unclear whether consumers will feel comfortable having bank information transmitted over their phones. While indications are strong that customers will want this, there is a danger that the fears relating to security and personal privacy will ultimately jeopardize uptake.
According to the Aite Group report, titled “Mobile Banking Security: The Black Cloud Attached to the Silver Lining,” the same types of attacks that have plagued the online world will inevitably migrate to the mobile.
“Though there is nothing that can be done to stop attacks from happening once mobile devices become viable mechanisms for financial transactions, banks must not shun offering mobile transaction services. The end-user will become savvy with time, and the channel will eventually develop mechanisms to further aid the customer. The key is for banks to get started sooner rather than later, in order to accelerate the learning curve and lessen exposure to mobile fraud when it does occur, ” says Nick Holland, senior analyst at Aite group and author of the report.