Mobile Banking Risks
Many banks now offer you the option to perform various banking transactions on your cell phone; this is called mobile banking. You can check balances and receive updates when your funds are low. The number of mobile banking users is projected to grow to over 40 million by 2012, according to the research firm TowerGroup. But with convenience sometimes comes risk. There are a number of vulnerabilities that may be involved when you use your phone to process bank transactions.
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No Anti-Virus Programs
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Many mobile phones are like mini-computers, yet they do not have the same capability as regular computers to host anti-virus and anti-spyware programs. The phone will not be able to recognize a situation where your device's files and programs have been compromised by malware. So when you perform banking activities on your mobile phone frequently, you could be leaving yourself vulnerable to spying.
Text Message Security
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Some mobile banking services text you updates regarding your account. These text messages are not encrypted, so any third party, including strangers and the people around you, can read them. If you leave your phone unattended or lose it, someone can easily access information about your account by reading your message inbox. However, one way to prevent this problem it to set a password on your phone so that you are the only person who can view your text messages. You can also delete the messages as soon as you finish reading them.
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Hard to Prove Fraud
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If your phone falls into the wrong hands and someone is able to process transactions using the device, there is no telling what your bank will do. It could be difficult to prove that you were not the person who performed the action on your phone. Because mobile banking is a relatively new service, some banks do not yet have clear procedures to address this potential problem.
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