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USERNAME AND PASSWORD AUTHENTICATION BORDERS ON NEGLIGENCE IN MOBILE BANKING

PINgrid iPhone

Author: Steven Hope, CEO of Winfrasoft
Earlier this week the Financial Conduct Authority announced that it will be publishing a full report in to mobile banking early next year, by revealing its initial findings and the potential risks to consumers concerning fraud, cybercrime and user error. In an article published by the BBC, the Director of Supervision at the FCA, Clive Adamson, states that: “With the market growing, now is the right time for us to take stock and, as part of the FCA’s forward looking approach, to ensure that consumers are appropriately protected.”

PINgrid iPhone

PINgrid iPhone

The scale of this market growth was highlighted earlier this year when the analyst firm Juniper Research published its Mobile Banking: Handset & Tablet Market Strategies 2013-2017 report revealing that the number of people using mobile phones for banking purposes will grow from 590 million in 2013 to one billion in 2017. If the security history books tell us one thing, it is wherever the masses go, the cybercriminal is sure to quickly follow suit.
Mobile viruses, phishing attacks, Trojans and worms have been with us for the past decade, however, as we shift our online habits from desktops and laptops, to tablets and smartphones, the bad guys have also altered their focus, realising the wherever the masses are, the money is to be found. In fact, McAfee recently reported that it found more than 17,000 new strains of malware targeting Android devices in a three-month period, representing a 35% increase.
So, with industry analysts telling use mobile device usage will grow exponentially and malware experts highlighting similar increases in the targeting of these devices it is clear we have two big challenges to overcome.
The first challenge is for the security industry to go back to square one and better educate the public about the risks of using their smartphones and tablets, in the same way they did to promote safe Internet usage. The second is for those who stand to lose (particularly the banks) to take a long hard look at the measures that they have in place to protect themselves and their customers.
As it stands today, the vast majority of mobile banking apps are using the same archaic and vulnerable username and password approach to authenticate customers, which they use for their Internet banking offering. In my opinion this borders on negligence, given the lack of favour amongst consumers and their ability to offer any serious safeguards against a determined cybercriminal.
Others have built cumbersome key ring or card readers based two-factor systems which are also loathed by customers, are extremely expensive to implement and manage and have been thwarted many times by hackers. Some banks just simply don’t “get” the agile on-the-go mobile banking customer at all and expect them to login to their new banking app, via their all singing all dancing super-slim and light-weight mobile device, using that same old clunky two- factor chunk of plastic!
Of course, for customer convenience and ease of administration it makes perfect sense for the security model used for online and mobile banking to be pretty much the same. The actual device should be largely irrelevant, especially given the vast number that are out there today. What is needed is a secure way for customers to prove who they are regardless of what phone, browser or app they are using. Furthermore, the logon method must be suited to the usage scenario – i.e. no key rings with iPhones, no TEXT messages when you have no signal and certainly no more passwords! The system must be easy to use and not get in the way of the customer doing what they want to do… banking.
In the next few weeks changes come in to force that will make it far easier for people to switch who they bank with, and with that comes added pressure for banks to up their game in order to gain and retain customers. Mobile platforms are today more secure than your average browser but that isn’t really saying very much! There is a responsibility from the customer to do what they can to safeguard the devices that they use and the banks need to do their utmost to create a strong and secure mobile banking environment and that means moving away from weak username and password authentication for good.
Author biography
An IT security expert and respected industry speaker, Steven is the founder of Winfrasoft and is regarded as a leading specialist and pioneer in the development, implementation and adoption of authentication software technology. He has lead the company in its development of a new generation of authentication solutions that deliver ground-breaking 1.5 and 2 factor authentication by transforming mobile devices in to secure tokens, and take advantage of the human mind’s ability to easily recognise patterns. In addition, he has been instrumental in introducing the ground-breaking 1.5 Factor Authentication concept as well as making Transaction Verification technology available to all.

About Winfrasoft PINgrid
Winfrasoft is a simple and secure password replacement system which also offers two factor authentication and award winning transaction signing capabilities. It can run inside a Banking App on any mobile platform (via SDKs), on an Online Banking web site, and can even be used with telephone banking so make that a much less arduous task. A full working demo is available at www.winfrasoftbank.com.

Banking

UBX appoints new Chief Investment Officer

In line with its strategy to explore and invest in companies and platforms of the future, UBX—the Fintech and Corporate Venture Capital arm of Union Bank of the Philippines (UnionBank) — is announcing the appointment of Matthew Kolling as the company’s Chief Investment Officer (CIO).

Matt Kolling

Matt Kolling

As CIO, Kolling will be managing UBX’s Corporate Venture Capital (CVC) fund. He will also play a key role in raising capital for UBX while assisting the company in key corporate transactions, including the structuring of joint ventures and acquisitions.

Prior to his appointment at UBX, Kolling has been Head of Venture Investments at Aboitiz & Company since 2019, wherein he had been working with UBX on investment portfolio decisions. Before that, he held senior positions in Private Equity, Venture Capital, and Investment Banking at firms such as Providence Equity Partners and Morgan Stanley in New York.

Kolling has more than 20 years of experience in managing investments and deals in the Technology and Telecommunications industries and is active in Venture Capital and startup communities in the Philippines and the Southeast Asian region. He currently chairs the Manila Angel Investors Network, among others.

“We at UBX are excited to welcome Matt as our new CIO. We firmly believe that Matt will be instrumental in driving value creation opportunities, both within the CVC fund and our corporate ventures. We look forward to working with him as we fulfill UBX’s vision of a future where banking services are embedded into everyday experiences that matter,” said UBX president and CEO John Januszczak.

Meanwhile, UnionBank president and CEO Edwin Bautista said, “The addition of world-class talents in our pool reinforces our strategy to future-proof the organization and our business as we prepare for many new opportunities that come with the changing times.”

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Banking

It’s all relative: Older generations feel helping out the family financially is more important since the Covid-19 outbreak

It’s all relative: Older generations feel helping out the family financially is more important since the Covid-19 outbreak 1

Before Covid, 23% of people prioritised helping younger generations out financially, that increased to a third as a result of the pandemic

A recent survey* conducted by Hodge has revealed that the Covid pandemic has led to more people wanting to help younger family members financially.

A third (31%)** of those questioned said that since the Covid outbreak giving a financial gift to children or grandchildren is more important to them, compared to 23% who said it was a priority before the pandemic.

The traditional “Bank of Mum and Dad” is still very much open for financial help, with parents being responsible for 72% of the gifts, but the study also revealed that financial gifts can come from all corners of the family – including children (14%) and siblings (14%).

The survey also found that a third of people have received a financial gift from family, with those aged between 25-34 as the most likely to receive

The most popular reason for gifting money to family is for special occasions such as a quarter of gifts were given for weddings and birthdays but 11% of people have received money to help with big purchases such as cars and houses. In addition, 19% of people have received help with day to day finances, with around 14% of those receiving a gift have done so to pay off debt.

Emma Graham, Business Development Director at Hodge, said of the research: “Our study showed that, as a nation, we all want to help our family out when it comes to money. And whilst we all think of the Bank of Mum and Dad or Gran and Grandad as a traditional source, we were surprised to see that 14% of brothers and sisters are also helping out.”

The findings come from a recent intergenerational study conducted by Hodge, who interviewed over 3000 people about their attitudes towards finances and their aspirations for the future. The full research findings can be found at https://hodgebank.co.uk/2020/05/19/money-its-all-relative/.

As part of the study, people were also asked about paying back the gift, with 40% of beneficiaries expecting to pay their parents back, but this dropped to 28% if the gift came from grandparents.

From the gift donor’s perspective, 26% expect the gift to be paid back, however just 15% of grandparents expected the money back.

Hodge has produced a set of guides on how families can navigate the tricky subject of giving financial gifts within a family, as well as the considerations and steps that be families should think about taking before a gift is given, such as is it a loan or a gift and thinking about contingencies if the family member’s circumstances change. The guides can be found here: https://hodgebank.co.uk/news/

Emma continued: “It’s clear that families feel strongly about offering financial support to each other if they are able and this has increased since the Covid pandemic. Before Covid, 23% of people prioritised helping their families out financially in the next five years. Since the Covid-19 outbreak that has increased to a third of people saying helping a family member financially had become more important.

“So, it is clear that the Covid-19 lockdown and subsequent predicted economic downturn, has led to more families looking to share wealth to help younger children or grandchildren during this difficult time. Many people may look to Later Life mortgages, where many products have reduced their rates and have flexible lending criteria, to help out a loved during these difficult times.”

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Banking

New report identifies the factors which will determine SMEs’ chances of a successful COVID recovery

New report identifies the factors which will determine SMEs’ chances of a successful COVID recovery 2

·         Analysis of the performance of over 1,000 UK small and medium-sized businesses by Allica Bank provides roadmap for SMEs 

·         Regular training, an openness to innovation, and a clear vision all contribute heavily to an SMEs’ chances of success  

·         Allica Bank has launched a programme of free workshops to expand on the findings and support business owners 

Business bank, Allica Bank has combined data and insight from over 1,000 UK SMEs with a multiple regression analysis to determine what factors most closely aligned with an SMEs’ chances of success and separated the highest-performing businesses from their peers. These ‘rules for success’ have been compiled from the research data to support British businesses as they look to chart a course to post-Covid recovery.  

The full report identifies six behaviours for small and medium businesses to follow, to maximise their chances of a successful COVID recovery. The six top-line rules emphasised by the data were: 

Rule 1: SMEs should regularly train staff 

Of the top-performing businesses analysed, 47% provided training for employees at least on a quarterly basis, compared to just 32% of other businesses. Regular employee training was linked closely to success by the model.  

Despite this, many small businesses have neglected training and nearly half (46%) of the small businesses analysed only provide training for employees about once a year or less often. This included 15% that never provide employer-funded training. This discrepancy could represent a significant opportunity for small businesses to unlock the potential of their employees and thrive in the post-Covid economy. 

Rule 2: SMEs need to focus on innovation and technology 

Looking again to the best performing businesses, 76% were found to either continually (39%) or often (37%) be considering new opportunities for technology in their business. This is compared to only 51% for businesses considered to be outside of the top ranks, out of which only 27% admitted to continually looking for new technology opportunities. 

Rule 3: Small business must have a formal, long-term vision  

Nearly two thirds (66%) of the most successful businesses in the survey had a formal, long-term vision, compared to just 50% of businesses outside the top 100. Looking to the businesses that scored the lowest on the SME Performance index, only 37% claimed to have a formal, long-term vision. 

Rule 4: SMEs should broaden their customer reach and find new markets 

Of the top-performing businesses, 65% of these have overseas customers compared to just 40% of the worst performing businesses. Among the best performing SMEs, over a third (34%) identified international expansion as one of the top three drivers for their success. 

Rule 5: SMEs need to develop reinvestment plans 

22% of the best performing SMEs reinvested some of their profits into the business in the past three years with an average 9% of profits being redeployed. Tellingly, this is nearly double what other businesses admit to reinvesting in their business (5%). 

Rule 6: SMEs should engage with local business organisations and networks  

Of the top 100 SMEs, 30% had obtained external credit to expand over the past three years (compared to 24% of other businesses). Meanwhile, only 16% of all other SMEs had engaged with local enterprise partnerships or growth hubs in the past three years (compared to 23% of the top 100 SMEs). 

Chris Weller, Chief Commercial Officer, Allica Bank, said: 

“All small businesses are different, as are all small business owners, but one trait they share is an innovative resilience. Whilst the coming months and years will undoubtedly continue to present extreme challenges, there is no doubt that small and medium sized businesses across the UK will rise to meet them head on.  

“To give them the best chance to succeed, though, they need to be equipped with the right tools. There is certainly no silver bullet or panacea for every small business, but as this study has found, there are a number of common factors found in the most successful businesses that allow small enterprises to thrive and that they can consider individually for their business.  

“This research has identified common ‘rules for success’ that speak to every aspect of running a business, not just the financials. Once we saw these results, we wanted to use them to help small businesses begin to re-build and prosper, by outlining common factors and then examining how best they can be practically applied to businesses in all sectors of the economy.  

“Small business owners and their employees have been hit hard by the crisis, but they have the drive and resourcefulness to breathe new life into the economy and bring energy to post-Covid Britain. Our commitment at Allica Bank is to give them the support they need to do so, every step of the way.”

The full report contains a wealth of additional data and insight into each of these topics. As part of its mission to empower small businesses, Allica Bank is making the findings freely available and running a series of free online workshops with relevant partner organisations for businesses to attend.

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