How to Protect Your Bank Account From Online Fraud

Online banking and digital bank accounts have transformed how the world does business. In 2022, financial innovations have made banking more accessible than ever to people living in even the most remote places on earth.

Undoubtedly, technology has played a pivotal role in transforming the industry. Ironically, it’s also created more opportunities for scammers to develop new techniques to rob people of their hard-earned money.

Adopting a cashless economy and digital payments has made life easier, but it has also increased online fraud. In 2021 an average of 229 scams occurred daily. Sadly the recovery rate for funds from these incidents is less than 1%.

How to Safely Manage Your Bank Account

How do Modern Bank Frauds happen?

Fraudsters have been coming up with new and innovative scams now and then. Some particularly notable ones:

  • Phishing, where malicious links are sent under the guise of official bank communications
  • Spoofing, where a fake website of a bank is created to steal credentials from  customers
  • Vishing,  when fraudsters pretend to be bank officials  to obtain personal details and other credentials over a phone call
  • Skimming, where devices are illegally installed on ATMs to record cardholders’ pins
  • Smishing, phishing attempts through short message services (SMS)
  • SIM Swap, this happens when a customer’s SIM is swapped with another to extract banking credentials

A Right To Information (RTI) query filed by India Today with the Reserve Bank of India (RBI) revealed that India saw more than 80,000 cases of banking frauds in 2021, totalling more than 1.3 lakh crores. Out of this massive sum, just over 1,000 crores was recovered.

To put things into perspective, between  2008 to 2021, over 3,14,000 banking fraud cases were reported in the country involving Rs. 5.31 lakh crore. Meanwhile, only a little more than 50,000 crores were recovered.

These aforementioned figures would leave anyone alarmed and compel them to be more cautious while managing their bank accounts. This article will look at how one can manage their bank accounts.

Tips for securely managing your bank account

Your bank account is your responsibility. Ideally, your bank account should be just as important as any other personal valuables. While banks can offer assistance to some extent, it’s better if you exercise vigilance and take extra precautions. After all, as the saying goes, prevention is always better than a cure.

Here are some top tips for how you can securely manage your bank account.

Ensure the safety of your chequebook, debit and credit cards

While most bank fraud occurs online, losing one’s chequebook, debit, or credit card can cause many problems, too. Before leaving a restaurant, ATM, or paying for something, ensure your cards are returned to you and be careful not to lose them. In addition, look out for card skimmers and other chips installed at public payment kiosks.

Protect your credit card from phishing

Use a password manager.

The average adult has a range of passwords that he or she has to remember. Sometimes people use the same passwords everywhere, putting their details and accounts at considerable risk. Cybersecurity experts often recommend using a password manager to store all your passwords and generate strong, new ones. It’s highly recommended that you change your passwords regularly, too. Avoid using standard password strings like ‘12345’ or ‘ABCDE’, which are easy for fraudsters to guess. Here are some password practices you should follow.

Don’t share passwords.

Never disclose login credentials, not even to IT (69% of employees share passwords with colleagues).

Diversify your passwords

During a data breach, hackers generally attempt to compromise other accounts with passwords they’ve managed to crack. By creating different passwords for various accounts, you’ll make it harder for hackers to tamper with other bills you might have.

Ensure two-factor authentication is enabled 

It is important to remember that passwords have limitations. To strengthen passwords, you could enable multi-factor authentication (MFAs). MFAs are usually tokens or mobile apps used to verify logins. The website https://twofactorauth.org/ explains how to enable 2FA on numerous websites.

Create a robust and long password

A complex password contains at least three character sets (e.g., uppercase characters, lowercase characters, numbers, or symbols) and 12 to16 letters.

Be careful not to use dictionary words.

A sophisticated hacker can search through tens of thousands of dictionary words across a variety of languages. Avoiding dictionary words prevents your accounts from becoming a victim of dictionary attacks.

One of the most popular passwords is 123456, and 12345 was the second most popular password; other common choices include 111111, princess, qwerty, and abc123.

Rotate your passwords

Every 90 days or less, passwords should be changed. Always avoid using simple passwords.

Avoid pre-signing bank instruments and other essential documents

Signing such documents beforehand is convenient and time-saving, but irresponsible behaviour can lead to misplaced or mishandled sensitive data.

Enable bank alerts

They are signing up for banking alerts and give the bank permission to inform customers about any banking transaction that occurs through their mobile phone.

Ensure that your computer is secure and free of malicious software

Make sure you are constantly browsing safe websites on your computer. Avoid downloading software or clicking on links that look suspicious. Installation of the software from such shady sites can result in malicious software being downloaded in the background of your computer, allowing hackers to control it remotely. Finally, ensure that your anti-virus systems are up to date.

Avoid using public Wi-Fi without a VPN

Public Wi-Fi hotspots are known to be insecure and susceptible to hacking. Through public Wi-Fi, it’s easy for hackers to use tracers and gather sensitive information from your devices. Using a virtual private network (VPN) is highly recommended.

DO NOT share your bank details with anyone.

Ensure you don’t disclose your bank account login details, confidential information related to your credit cards such as your CVV number and expiry date, or your PIN to anyone. If you tend to forget such personal data and have a habit of noting it down somewhere, then make sure that it is out of the reach of anyone else.

Stay alert at all times.

Despite taking all the safety measures, there might still be tiny gaps that skilled fraudsters can take advantage of to gain access to your bank accounts. Therefore it is your responsibility to be vigilant at all times. If you encounter any suspicious activity with your bank accounts, notify the bank immediately.

Conclusion

The steps mentioned above are must-dos for any account holder. There are many other ways to protect your accounts, but the most important thing is to stay vigilant and take mitigation measures if something occurs.

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