South Africa: SA 'Wary' of Internet Banking

Banking on the internet has become a mainstream activity, but a study says many South Africans still believe that visiting a branch is safer than online platforms.

This is according to a survey by security firm Kaspersky Lab in conjunction with B2B International that says 43% of South Africans feel that traditional over-the-counter transactions are safer than internet banking.

"If customers choose traditional over-the-counter banking, from fear of falling victim to internet fraud, it will hamper the adoption of high-margin online and mobile payment systems. This will force banks to invest more of their resources in low margin branches instead," said Ross Hogan, global head of the Fraud Prevention Division at Kaspersky Lab

Conversely, an overall majority of South African bank customers (64%) feel vulnerable when conducting online transactions.

Despite that, Kaspersky found that when people go online, they fail to take basic security measures to protect their accounts.

Security experts have found that despite storing details such as log ins, passwords and even IDs on smartphones, people generally fail to use strong passwords on their gadgets.

Malware

Criminals can compromise bank accounts by setting up a phishing page where people unwittingly hand over key details like usernames and passwords.

Kaspersky found that despite fears over cyber crime, 74% of South African internet users used computers for online payments, 22% used smartphones and 32% used smartphones.

A Trend Micro report recently said that just three malware applications make up the majority of attacks on the financial system in SA.

They are: SWISYN, which makes up 37% of detections, followed by DORKBOT (27%) and ZEUS/ZBOT (23%). These applications are able to steal log-in credentials, copy key strokes and download additional malware on to compromised PCs.

In SA, laws such as the Financial Intelligence Centre Act (38 of 2001), known as FICA, seek to eliminate money laundering and provide a safe financial transacting environment. However, criminals don't play by the rules.

"Through various channels including illicit means they [criminals] can then recreate an identity book or passport and proof of address (everything required by FICA). In essence enough information to be able to open a bank account, apply for credit, goods and services. Obviously none of this will be re-paid and the scam is complete," independent identity verification expert Dawid Jacobs recently told Fin24.

SOURCE:FIN24