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October 28, 2015

Online payments at risk as banks fail to secure transactions

News: Nearly 50% believe that online financial fraud is increasing.

By CBR Staff Writer

Around 33% of financial services do not provide a secure online payment channel for customers, despite the increase in online transactions.

According to a survey conducted by Kaspersky Lab and B2B International, it was found that several banks and payment companies are facing difficulties to fully protect themselves and their customers from financial fraud.

Around 65% of the respondents claimed that their customers are conducting financial transactions through different devices, yet only 53% have implemented two-factor authentication.

Only 50% of the respondents have introduced a specialised, real-time anti-fraud solution despite knowing the fact that is the most effective form of protection available.

42% of those surveyed have extended specialised, real-time anti-fraud solution to customer devices, and around 67% of the respondents claimed that they have implemented a secure connection for all online payments.

However, instead of removing risks just 48% of the respondents said that they just mitigated the risks, and 29% also said that it is cheaper to deal with online financial fraud incidents than to prevent them from happening.

Most of the respondents favoured specialist solution rather than general internet-security software solutions for the prevention of well-disguised phishing and malware attacks that can lead to financial fraud.

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The financial sector has always been the prime target of hackers, and recently the National Crime Agency (NCA) urged Britons to protect themselves from cyber attacks after hackers stole around £20m from UK bank accounts.

Kaspersky Lab UK and Ireland general manager Kirill Slavin said: "The study shows that banks and payment organisations are finding it difficult to manage online financial fraud in today’s connected, omni-channel consumer landscape.

"38 per cent of the organisations we spoke to admit that it is increasingly difficult to tell whether a transaction is fraudulent or genuine, with a worrying one in three opting for a ‘we’ll deal with it as it happens’ approach to fraud protection.

" If you consider that our own research uncovered 22.9 million financial malware attacks in 2014, targeting 2.7 million customers worldwide, it is clear that dealing with each incident individually is not a viable, long-term option."

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