Mobile usage in the U.S. has climbed over the past year, with nearly 57 million consumers saying they use mobile banking. Nearly 70% of millennials are mobile users, the greatest amount of any generation.
But is mobile banking safe? For the most part, the answer is yes. Online banks typically do everything they can to keep your data safe. But it’s also up to you to use common sense and follow a handful of simple rules to protect yourself from fraud and cyberattacks.
How Is Mobile Banking Different From Online Banking?
At its simplest, mobile banking consists of financial transactions made through the use of a mobile device, such as a cell phone or tablet. Transactions range from simple ones, like signing up to have your bank send you informational text messages, to the more complex, such as paying bills, sending money to other people, receiving funds, and others.
Traditional brick-and-mortar financial institutions are increasingly offering internet-based services, and there are now mobile financial institutions that don’t even have an actual building for customers to use. Their mobile devices and apps are their branches.
Not all internet-based banking transactions are mobile ones. The difference between mobile banking and online banking is that mobile banking is a form of online banking — however, it’s not the only type. You could, for example, conduct financial transactions on your home computer as well.
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Mobile Banking Safety Tips
To make sure you’re using your bank’s mobile tools in the safest way possible, follow these safety tips:
1. Create a Strong Password
Use strong passwords to protect your personal information. Passwords should be long — the longer, the better — so hackers have a harder time using code-breaking software to crack it. Strong passwords should contain a random mix of letters, numbers, and special symbols. They should also use a mix of capital and lowercase letters, and they should not contain any personal information or words you’d find in the dictionary.
Weak passwords are those that are easy to guess. As an obvious example, don’t use the word “password” as your login. Another example of a weak password would be your name and birth year, which is information that hackers can easily find. Also, don’t reuse your passwords. Come up with a fresh one every time.
2. Avoid Using Public WiFi
Another important mobile banking security tip is to always use public WiFi with caution. If you must use it, try to use a secured network whenever possible that requires a password to sign in. If a secured network is unavailable, the next best thing is an unsecured network that requires login information of some sort.
That said, whenever you’re using public WiFi, do not access your bank account or any other sensitive personal information.
Also, turn off settings on your devices that allow automatic connectivity, which could permit your computer or mobile device to connect to a network that you would otherwise want to avoid. Be sure to monitor your Bluetooth connections as well, since Bluetooth can allow other devices to connect directly to yours.
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3. Use Your Bank’s Official App
Another tip to stay safe with mobile banking is to download your bank’s official app. When you do so, be on the lookout for possible fakes. Pay attention to the developer of the app, and also look to see if there are any other apps with the same or similar names. If possible, download the app from your bank’s website. Otherwise, use a reliable app store.
Your bank should also be able to offer you information about their app, including the app’s security features and what information you’ll need to access it. Once you’ve downloaded the official app, conduct your mobile banking on the app instead of through a web browser, which may be less secure.
4. Don’t Save Login Information in Your Browser
Some web browsers give you the option to save your username and password within the browser — never do this for your online and mobile banking. If your phone is ever lost or stolen, this could make it easy for hackers to access your bank account.
If you’re worried about remembering your password — especially if you’re being safe and you’ve come up with a complicated one — consider using a reputable password manager. These apps can manage usernames and passwords for multiple websites and applications, and have safety features in place to protect this information from hackers.
5. Use Two-Factor Authentication
One security measure being used by many financial institutions today is two-factor authentication, which requires users to provide at least two forms of identification, such as their password and a fingerprint.
Alternatively, in addition to a password, the second piece of authentication could be a numeric code that the user requests and receives via text. This code can only be used one time, preventing it from having value to hackers in the future.
Two-factor authentication vastly improves security on your phone, though it’s still possible that hackers could intercept authentication information sent to you via text or email.
6. Use Activity Monitoring
Your bank may offer you the ability to sign up for alerts for all sorts of account activities, from mobile deposits and withdrawals to wire transfers. This type of activity monitoring or user activity tracking can also boost security.
Your bank can send you quick alerts when they detect possible fraudulent activity. They may be able to send your alert via text, email, or even directly through the bank’s app. You’ll then have the opportunity to confirm or dismiss potentially fraudulent activity, allowing your bank to act swiftly on your behalf if necessary.
7. Beware of Phishy Links
Phishing scams are one of the most common forms of cyber fraud. They work by tricking individuals into giving away private information. For example, scammers might send an email that looks like it’s from your bank or a business you’ve recently been in contact with. These emails might include a link that, once clicked upon, will install a virus on your device that can gather personal data.
Be wary of phishing scams, and never open links in email or text if you aren’t 100% sure of their origin. Remember, you can always call your bank, or other places of business, if you suspect a phishing scam, and they can let you know whether or not they sent the email.
8. Always Log Out
When you’re done using your mobile banking app, be sure to log out to protect your information. Luckily, many banking apps will do this for you automatically. That said, you also may want to log out of any app that might contain personal information, such as your email, social media, or mobile wallet, when you’re done using them. If your phone were to get lost or stolen, you’d want to make it as difficult as possible for bad actors to access this information.
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Online-Only Account Options
Traditional banks, credit unions, and other financial institutions often provide internet-based services for customers in addition to the ability to make in-person transactions.
Financial institutions that don’t have brick-and-mortar locations can keep overhead costs low, which may allow them to offer higher savings or checking account rates and lower fees, in addition to the convenience of 24/7 banking.
For people whose work and other responsibilities make it difficult to visit a bank during traditional banking hours, the ability to do their banking at any time of day or night might be an important consideration when choosing a bank.
Mobile depositing can be quite convenient and, like other banking services, can generally be used around the clock. Usually, you’ll need to endorse the check you’re depositing and take a photo of the front and back — some institutions may have additional requirements. Deposits typically show up within a few business days, depending upon the bank’s rules and the time of your deposit.
Some banks may have limits on how much can be deposited daily or monthly when using mobile deposit. Also, some banks may charge a fee for mobile deposits, which is another thing to be aware of when choosing to go mobile.
Although most online banks provide a customer service line, they may not provide access to a personal banker who can help you set up accounts, apply for loans, or discuss an issue you’re having.
Mobile Banking Safety Measures
Banks have invested hundreds of millions of dollars into cybersecurity in an effort to protect consumers’ accounts. They’ve put into place security measures such as Secure Socket Layer (SSL) encryption, automatic logout, antivirus and anti-malware programming, firewalls, multi-factor authentication, and biometric and/or facial recognition technology.
Using these measures is also an effort to protect themselves from cyber threats. Under the Federal Reserve’s Regulation E, consumers are only liable for the first $50 lost due to unauthorized access to their account, as long as they report the activity in a timely manner. Their bank is responsible for any loss over that amount.
If you’re unsure what measures your bank takes to protect your data, it’s reasonable to ask the question. If you’re not satisfied with the answer, you may consider exploring other options.
The Takeaway
As you can see, banks make an effort to make mobile banking safe. Plus, you can take additional steps yourself to further ensure mobile banking security, such as creating a strong password, using your bank’s official app, and keeping an eye out for any phishing attempts. When you’re choosing a bank, however, it’s still important to consider what security measures it has in place.
One option you might consider when you’re deciding where to bank is SoFi Bank, N.A., which offers checking and savings accounts. You can get a competitive APY, and there are no account or overdraft fees. Plus, SoFi Bank provides a number of security features.
SoFi members with direct deposit activity can earn 4.50% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
SoFi members with Qualifying Deposits can earn 4.50% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.50% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 8/9/2023. There is no minimum balance requirement. Additional information can be found at http://www.sofi.com/legal/banking-rate-sheet..
SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
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