digital banking security

The Importance of Account Holder Education: Best Practices that will Keep Digital Banking Users and Your Institution Safe from Fraudsters

In 2023, data breaches in the United States surged to 3,205 from 1,802 in 2022, according to Statista. These breaches exposed 353 million instances of private consumer information. Additionally, a Verizon Security Report found that 81% of data breaches are caused by poor password management. 

Despite such stats, financial institutions often hesitate to enforce complex password requirements and regular password changes in their security policies due to concerns about inconvenience for their customers and members, which could lead to a negative user experience. In general, users – both consumers and employees of your institution - opt for 1) simple passwords, especially if they utilize multiple applications; 2) the same repeated password; or 3) passwords with subtle differences, leading to passwords that are easily exploited by attackers

Team Alogent’s digital solution experts have found that there are greater benefits in educating account holders about proactive password management, paired with other best practices, rather than waiting for a security breach to occur and funds to be lost as a result of lax information. 

Educate, Empower, and Encourage Password Best Practices, Don’t Force It

Passwords function as the primary defense in safeguarding data, serving both account holders and staff alike. Educating customers and members becomes significantly more impactful when employees consistently practice good password habits. Cultivating a culture of “security first” not only shields assets, but also promotes secure behaviors, benefiting all stakeholders involved.

  • Encourage the use of passphrases, not passwords. Passphrases are easier for users to manage than passwords. Random words can be combined with spacing, like “boat letter taco moon,” as can a unique phrase that only the user knows, making it harder for a fraudster to guess.
  • Recommend Multi-Factor and Biometric Authentication. Coupling a password with a second-factor authentication (MFA) method, like a unique code or biometric identifier, enhances account security. It’s advised that your digital banking platform uses MFA to strengthen online banking access security. 
  • Promote the use of a password manager. Password managers, or vaults, are encrypted solutions that store passwords online or on devices. This software also alerts users when passwords are weak or have been reused, prompting a quick and easy change with recommendations.
  • Set password rules. Incorporating special characters and setting a minimum password length within your digital banking platform is crucial. Educating users about the importance of creativity and extending beyond the minimum length requirement is also essential. Encouraging them to blend uppercase and lowercase letters, and choosing special characters that resonate with them, enhances security measures.  

Tips For Account Holders to Ensure Safe Digital Banking

In addition to offering education around password best practices, it's crucial to inform your account holders about additional measures that ensure their safety. Together, these efforts add layers of protection to sensitive data for both your account holders and your institution.

  • Avoid using unsecured public Wi-Fi. Without proper encryption, hackers are waiting to exploit information through online banking. Share ways to remain alert, including being cautious when accessing “free Wi-Fi” or “guest Wi-Fi” networks, as these may already be compromised. Instead, account holders should opt for password-protected networks or utilize their own secure hotspots to mitigate risks.
  • Be aware of obvious scams. Ensure account holders understand that your institution will never call or email to confirm their identity or request personal information. It’s crucial to educate them on your security policies to safeguard both their interests and the integrity of your institution.
  • Enable notifications. Encourage your account holders to establish text or email alerts to stay informed about their account activity. This ensures that any suspicious logins or transactions can be promptly identified and reported, minimizing potential risks.

NXT-Level Protection for Account Holders and Financial Institutions

Render maximum security, control, and customization of your digital banking channels with NXT, Alogent’s digital banking platform for consumers and businesses with mobile and online applications. With robust out-of-the-box functionality, NXT offers configurable options to promote and strengthen password security. These features can be gradually implemented with educational programs, allowing your institution to offer enhanced protection methods, while maintaining a leading edge in security measures. 

Discover how NXT’s enterprise-grade security features protect against OWASP Top 10 and Mobile Top 10 vulnerabilities, keep your account holders and institution safe. 

Learn more in this document: rock-solid security features in nxt

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