What is E-Banking?

BY MEDHA MAYOOKH

INTRODUCTIONOnline banking or eBanking allows customers of a 

financial institution to conduct financial transactions on a secure website operated by the institution, which can be a retail or virtual bank, credit union or building society.

About 680,000,000 results of eBanking available on Google.

HISTORYThe precursor for the modern home online banking

services were the distance banking services over electronic media from the early 1980’s.

 The term online became popular in the late '80s and referred to the use of a terminal, keyboard and monitor to access the banking system using a phone line.

 Online services started in New York in 1981 when four of the city’s major banks offered home banking services using the videotex system.

using the videotex system.

SECURITYSecurity of a customer's financial information is very

important, without which online banking could not operate.Financial institutions have set up various security

processes to reduce the risk of unauthorized online access to a customer's records, but there Is no consistency to the various approaches adopted.

The use of a secure website has become almost universally adopted.

Though single password authentication is still in use, it by itself is not considered secure enough for online banking in some countries. 

ATTACKSMost of the attacks on online banking used today are based

on deceiving the user to steal login data and valid TANs.  Two well known examples for those attacks are phishing

 and pharming.Cross-site scripting and key logger/Trojan horses can also

be used to steal login information.

COUNTERMEASURESThere exist several countermeasures which try to avoid

attacks.  Digital certificates are used against phishing and

pharming, the use of class-3 card readers is a measure to avoid manipulation of transactions by the software in signature based online banking variants.

 To protect their systems against Trojan horses, users should use virus scanners and be careful with downloaded software or e-mail attachments.

In 2001 the U.S. Federal Financial Institutions Examination Council issued guidance for multifactor authentication (MFA) and then required to be in place by the end of 2006.

MOBILE BANKING

MOBILE BANKINGMobile banking is a system that allows customers of a 

financial institution to conduct a number of financial transactions through a mobile device such as a mobile phone or personal digital assistant.

Mobile banking differs from mobile payments, which involve the use of a mobile device to pay for goods or services either at the point of sale or remotely, analogously to the use of a debit or credit card to effect an EFTPOS payment.

HISTORYThe earliest mobile banking services were offered over 

SMS, a service known as SMS banking.With the introduction of smart phones with WAP support

enabling the use of the mobile web in 1999, the first European banks started to offer mobile banking on this platform to their customers.

Mobile banking has until recently (2010) most often been performed via SMS or the mobile web.

SECURITYPhysical part of the hand-held device. If the bank is offering

smart-card based security, the physical security of the device is more important.

Security of any thick-client application running on the device. In case the device is stolen, the hacker should require at least an ID/Password to access the application.

User ID / Password authentication of bank’s customer.

SMS BANKINGSMS banking is a type of mobile banking, a technology-

enabled service offering from banks to its customers, permitting them to operate selected banking services over their mobile phones using SMS messaging.

SMS banking services are operated using both push and pull messages.

Push messages are those that the bank chooses to send out to a customer's mobile phone, without the customer initiating a request for the information.

Pull messages are those that are initiated by the customer, using a mobile phone, for obtaining information or performing a transaction in the bank account.

CONCERNS AND SKEPTICISM ABOUT SMS BANKINGThere is a very real possibility for fraud when SMS banking

is involved, as SMS uses insecure encryption and is easily spoof able.

Supporters of SMS banking claim that while SMS banking is not as secure as other conventional banking channels, like the ATM and internet banking

 the SMS banking channel is not intended to be used for very high-risk transactions.

QUALITY OF SERVICES IN SMS BANKINGBecause of the concerns made explicit above, it is

extremely important that SMS gateway providers can provide a decent quality of service for banks and financial institutions in regards to SMS services.

Therefore, the provision of Service Level Agreement(SLA) is a requirement for this industry

it is necessary to give the bank customer delivery guarantees of all messages, as well as measurements on the speed of delivery, throughput, etc.

SLAs give the service parameters in which a messaging solution is guaranteed to perform.

E-payments

Electronic funds transferElectronic funds transfer (EFT) is the electronic

exchange.Transfer of money from one account to another, either

within a single financial institution or across multiple institutions, through computer-based systems.

DISCUSSION