The Scandinavian countries have the largest number of Internet users, with up to one-third of bank customers in Finland and Sweden taking advantage of e-banking. In the United States, Internet banking is still concentrated in the largest banks. In mid, 44 percent of national banks maintained transactional websites, almost double the number in the third quarter of These banks account for over 90 percent of national banking system assets. The larger banks tend to offer a wider array of electronic banking services, including loan applications and brokerage services. While most U.
To date, most banks have combined the new electronic delivery channels with traditional brick and mortar branches "brick and click" banks , but a small number have emerged that offer their products and services predominantly, or only, through electronic distribution channels. These "virtual" or Internet-only banks do not have a branch network but might have a physical presence, for example, an administrative office or nonbranch facilities like kiosks or automatic teller machines.
The United States has about 30 virtual banks; Asia has 2, launched in and ; and the European Union has several—either as separately licensed entities or as subsidiaries or branches of brick and mortar banks.
This changing financial landscape brings with it new challenges for bank management and regulatory and supervisory authorities. The major ones stem from increased cross-border transactions resulting from drastically lower transaction costs and the greater ease of banking activities, and from the reliance on technology to provide banking services with the necessary security.
Regulatory risk. Because the Internet allows services to be provided from anywhere in the world, there is a danger that banks will try to avoid regulation and supervision. What can regulators do? They can require even banks that provide their services from a remote location through the Internet to be licensed. Licensing would be particularly appropriate where supervision is weak and cooperation between a virtual bank and the home supervisor is not adequate.
Licensing is the norm, for example, in the United States and most of the countries of the European Union. A virtual bank licensed outside these jurisdictions that wishes to offer electronic banking services and take deposits in these countries must first establish a licensed branch. Determining when a bank's electronic services trigger the need for a license can be difficult, but indicators showing where banking services originate and where they are provided can help.
For example, a virtual bank licensed in country X is not seen as taking deposits in country Y if customers make their deposits by posting checks to an address in country X.
If a customer makes a deposit at an automatic teller machine in country Y, however, that transaction would most likely be considered deposit taking in country Y. Regulators need to establish guidelines to clarify the gray areas between these two cases. Legal risk. Electronic banking carries heightened legal risks for banks.
Banks can potentially expand the geographical scope of their services faster through electronic banking than through traditional banks. In some cases, however, they might not be fully versed in a jurisdiction's local laws and regulations before they begin to offer services there, either with a license or without a license if one is not required.
When a license is not required, a virtual bank—lacking contact with its host country supervisor—may find it even more difficult to stay abreast of regulatory changes. As a consequence, virtual banks could unknowingly violate customer protection laws, including on data collection and privacy, and regulations on soliciting. In doing so, they expose themselves to losses through lawsuits or crimes that are not prosecuted because of jurisdictional disputes.
Money laundering is an age-old criminal activity that has been greatly facilitated by electronic banking because of the anonymity it affords.
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Once a customer opens an account, it is impossible for banks to identify whether the nominal account holder is conducting a transaction or even where the transaction is taking place. To combat money laundering, many countries have issued specific guidelines on identifying customers. They typically comprise recommendations for verifying an individual's identity and address before a customer account is opened and for monitoring online transactions, which requires great vigilance.
With electronic banking crossing national boundaries, whose regulatory authorities will investigate and pursue money laundering violations? The answer, according to the task force, lies in coordinating legislation and regulation internationally to avoid the creation of safe havens for criminal activities.
Operational risk. The vulnerabilities in the network allow the hackers to get access to the information band data of the users.
Malware is the type of attack in which the unauthorized users can get access to the information of the users. The hackers can inject the malware through the internet connection. After injecting the DDOS, the hackers can break the passwords and the chipper text by using the brute force attacks. The vulnerabilities in the network allow the hackers to get access to the accounts of the users and steal all their confidential information and data. The Trojan is the type of the malware, which can allow the hacker to attacks through the system. The dead of the paying the services and good electronically is not a new concept.
In the early stages of the internet evolution, it was common to make all the assumption that each of these machines that are used by the ten people. Mostly the hackers hack the mobile phones applications to steal the information and data of the users and misuse it. The different aspects of the security are mentioned as well as the threats are also explained that what rather threats a mobile phone is faced.
As with the advancement in the technology, the android is the most famous operating system and it will offer the different application to its users. The hackers focus on the Android, hacked the application of the Android, and attach the malicious code to the applications. It is stated in the report that the mobile phone is hacked and this attack is mostly in android application. It is stated that the apple is suffered from the mobile hacking because the hacker hacked the application of the app store. The man-in-the-middle attack is an attack through which the hacker is in the middle of every transaction.
In this attack, the hacker can sit in the middle of the network all the information between the user and the bank are located by the man in the middle. The hackers can get access to the information and data of the users. All the confidential information of the user can steal by the man in the middle Khan, Phishing is the process through which the hackers acquire all the sensitive information and data of the users.
Through the phishing, all the sensitive data of the users can hack with the help of the network. The PCI DSS is applied to the network just to protect the information of the customers who use the application of online transactions. While making the DSS it is important to focus on some points to provide the dedicated link for the customers to operate. It is important to protect the network system by applying the firewall between the routers through this it is easy for the customers to operate their accounts.
The team should monitor all the accounts of the customers and regularly check the network system just to confirm that there are no malware attacks over the network. The cyber-security framework is applied to the system that will help to protect the confidential information and data of the customer from unauthorized access. If the network is secured it is easy to protect the information card and it is easy to protect the bank amount details of the customers Ericsson, Only the authorized users can get access to the network system and they have encrypted users ID and passwords, which they use to log in their accounts.
Online banking >challenges__amp__opportunities
The banking websites are made according to the PCI DSS instruction and the team can follow these steps like Maintaining and building the secure network, Access control measures. For this study, research is conducted for Security in electronic banking transactions. Research is conducted for the data collection through the second method and the qualitative approach is used.
The data is collected from the reliable and valid resources as discussed in this section. In the secondary data collection, the method the data is collected from the previous researchers, journals articles, peer-reviewed articles, newspaper articles and reports that are published in the authentic resources. Current research uses the secondary analysis is considered for the effective purposes of the prior study focused on the original work of the journal and authentic source of books for security in electronic banking transactions. There could be better analysis of the security in electronic banking transactions.
The research question, hypothesis, and aims of the research discussed. This study makes sure to do work with effective efforts and it fulfilled the demand of the study. All the research questions have the answer and drawback of the topic. Through secondary data, the research is investigating each perspective for the secondary research.
Secondary research could be better than the systematic reviews and meta-analysis for these qualitative studies. The research investigated the security in electronic banking transactions. We know thousands of companies are engaged with e-banking. This research is focused on the online global banking and their securities concerns.
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Every bank represented their region and allowed for comparing the security in electronic banking transactions of the different bank in Saudia Arabia. Standardized reports get from the banking about security concern in the transactions. For this research, the ten features are used for collection of data. The features of this security concerns are mentioned here:. In this research, secondary research is used for the multiple qualitative data sets that can get from the previous journal and authentic books.
Through the consideration of the previous data of the journal and used for utilization of the existing data. The secondary research focused on the effective tool that used for this research. The research can make the collection of the data that is relevant to the effective materials and sample can collect and analyzed data that get from the previous researchers.
Impact of perceived security on consumer trust in online banking
In this study, all data collected from the authentic source. In this study, current researchers focused on the secondary and qualitative data collection method can be used for researching the security in electronic banking transactions. Various data of the literature review can be used for analysis of the security in electronic banking transactions. Bank made the efforts for safe the security concern about transactions. The qualitative method focused on the elaboration of the exact phenomenon of the existing problems.
The secondary data analysis is effective for the qualitative data.