Banks consider double-checks to protect their online customers

Banks in New Zealand are following an Australian initiative to increase security for their internet services.

Internet banking came under fire after it was discovered how spyware software could be used to access customer accounts.

The National Australian Bank, which owns Bank of New Zealand, is now using a cellphone text message security system for customers completing third party payments.

Once an online payment is initiated, the free, optional system sends a randomly generated, one-time-only code via SMS to a customer's mobile phone.

The customer then enters the code into the confirmation screen to complete payment.

Kiwibank spokesman Bruce Thompson said it is considering the use of texting customers to increase their internet security.

 

"We have not had a large amount of internet fraud committed against the bank, and as long as customers continue to be careful and keep their pin number secure, most internet fraud can be prevented.

"However we are looking at an authentication process to see whether or not the costs would be justified and if our customers would wish to use it."

Mr Thompson said only 34 of of 2 1/2 million internet transactions last year had some aspect of fraud associated with them.

"In percentage terms it is very very small. Any form of fraud causes a bank concern, but we need to keep a perspective on it, and we are continually bringing in security measures," he said.

BNZ spokesman Owen Gill said it hoped to set up a "two-factor authentication" system soon.

"The search is on for second-factor systems that are reliable and don't cause a great deal of inconvenience for customers.

"We have identified a system that we think will work in New Zealand and we are investigating it thoroughly now with a view to making concrete progress on it in the next few months."

Mr Gill did not say what the security measures involved, except to say it was not an SMS system.

ANZ spokesman Craig Howie also said they were considering a number of security options, but texting would not be used.

- NZPA