Acknowledging the challenges faced by banks in thecyber era, a topRBI official has said banks should ensure transactions are hassle-free and user-friendly so as to the retain loyalty of customers.
"For example, multi-layer security by way of login password, transaction password and confidential data confirmation make online transactions more secure.
"But, there are issues like memorising multiple passwords, slogans, pictures, answers to questions, etc, and some transactions of urgent nature getting struck due to these problems, or even online access getting blocked some times.
"This, coupled with the time taken for access re-activation, password generation, etc, which is sometimes a lengthy, time-taking process, causes irritation and inconvenience to the customer," said RBI Executive DirectorG Padmanabhan at the Annual Conference on Secure Banking 2011 organised by theIndian Banking Association (IBA)) recently.
He said managing security was more challenging in online and phone banking compared to other delivery channels.
Threats to ATMs also take the form ofATM skimming,eavesdropping,spoofing and service denial, he observed, citing threats like password hacking, cardcloning, data and identity theft at various levels of the transaction, Padmanabhan added.
Observing that identity theft in electronic transactions is a growing cybercrime, Padmanabhan said innovative methods of hacking and stealing have come to the fore regularly and the industry has to take prompt action to safeguard business and customer interest.
Stressing that management of third party risks in transactions has becoming a daunting task, he said unlimited cyberspace exposes banks to internationally organised crimes.
"Inmobile banking, the challenge is to decide the transaction value limits up to which un-encrypted data can be transmitted for payments and funds transfer. If limits are set too tight, there can be cost and efficiency implications while making it too lax may invite the risk of information getting compromised.
"If we recognise that compromise of cards could happen, not only at ATMs but also at to over half-a-million and still growing point of sale (PoS) terminals, the task is indeed formidable," the RBI official said.
On the modus operandi of fraudsters, he said after the RBI introduced second factor authentication, their focus has shifted to ATM transactions.
Source : ET
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