e-banking? It pays to be cautious

MONEY & U

Salman often uses his office PC to dabble in the stock market. He makes payments using the internet payment gateways. While he thinks his personal identification number "" or PIN "" is secure, the fact is his PC is accessible to all in his organisation and to cyber robbers.

With high internet accessibility, it is easy to hack into a PC, be it in the home or office version of it.

V Leeladhar, chairman of Indian Banks' Association (IBA) and chairman and managing director Union Bank, however, warns "fraudsters and cyber criminals are not far behind with 'Anywhere' and Internet banking".

He says not all websites of Indian banks are adequately secure.

While banks need to keep abreast with the latest technology on e-security, bank account holders need to do their own part to ensure they are not playing into the hands of fraudsters.

According to Vijay Mukhi, chairman of Nasscom's special interest group for security, cyber crimes in the first five months 2004-05 have already crossed the 1.37 lakh. "Banks fear that if a cyber crime is reported, it could lead to a run on the bank," Mukhi says.

In India there have been cases of fraud where banks using software to calculate interest on saving account balances. The software was programmed in such a manner that 90 per cent of the interest would be credited to the respective bank account holder and 10 per cent would be transferred into a special account set up by the programmer himself-his own!

All banks have firewalls in place and 128-bit encryption. Encryption allows information to travel between you and the bank in a secure environment that cannot be read by anyone else. It is a way of 'scrambling' information to make it impossible to read unless the recipient has the ability to 'un-scramble' it.

The strength of encryption can be measured by the number of 'bits' used in the 'scrambling' process. The latest web browsers use 128-bit encryption: the most secure form currently available. Internet nbanking can only be accessed using 128-bit encryption. In short, it will take a hell of a lot of permutations and combinations to hack websites.

But when passwords are lying around and banks have disgruntled employees or if banks have not taken enough measures keep on changing the password, no amount of investment in security will help.