Banks boost online, card security to avert hacking

FHM Humayan Kabir

Private banks have bolstered security of their online operations and cards in recent months amid growing concerns that hackers could break into their software firewalls by using sophisticated tools.

The move comes as the banks are rolling out an ambitious plan to double ATM booths in a year while most are expanding their online services in an attempt to cut congestion at teller's desk.

With wages in banks spiking every year, bankers said putting more consumer services and operations online is the only option to enhance their productivity level and ensure handsome profit.

But as they launch the digital drive, hacking and online breaks-in have emerged as a major worry -- although no banks have yet to report any breachings of their digital security.

"We have recently started to use micro-chips in our credit and debit cards," said Managing Director of Dutch-Bangla Bank Ltd. (DBBL) KS Tabrez.

"The aim is to stop hackers or organised racket from acquiring account information of our customers. It's a serious issue and we are spending heavily on sophisticated software and firewalls to check fraud," he said.

He added DBBL has also set up secured and protective software in central database server to check hacking -- the kind of the fraud which has become commonplace in developed countries.

Last week three British citizens of Nigerian descent were jailed 13 years each for hacking into the UK banking system. It was found the trio compromised over 900 bank accounts and 10,000 credit cards with losses standing at around a million dollar.

However, that figure is expected to rise to around six million dollars, according to London-based the Daily Mirror.

In Bangladesh some 15 private banks have over 2,500 ATM (Automated Teller Machine) booths spread mainly in the major cities. The number is set to be doubled by end of 2012, bankers told the FE.

DBBL, a third generation private bank, has been the pioneer in ATM and online banking services in the country. It set up its first ATM booth in 2004 and in the next six years it added another 1,450 booths.

But some other banks have recently unveiled new plans to narrow the gap with DBBL, as they have found online services, card business and cash points as new money-spinners.

They are Brac Bank, Islami Bank Bangladesh Ltd. (IBBL), the City Bank, Prime Bank, United Commercial Bank, Standard Chartered Bank, HSBC and Eastern Bank.

IBBL Managing Director Abdul Mannan said his bank was late in card business, but to make up the lost time it has unveiled an "ambitious drive" to add 1000 ATM booths by 2012.

"Last week, we have signed deal with the ATM service provider Omnibus to avail access to 900 cash points for our ATM card holders. Besides, we will also raise our own booths to 150 by year-end from the existing 86," he told the FE.

"But as we head towards online expansion, we are aware of the security issues that we have to put in place," he sad, adding the bank has bought "best" banking software to check fraud.

The IBBL, the country's largest private bank with nearly 6.7 million account holders, now sees Tk2.40 billion transacted through its existing 86 booths every months. In 2009, the amount was negligible.

Prime Bank MD M. Ehsanul Haque told the FE the second generation bank was also expanding its online services and it was set to open 200 new ATM booths by 2012.

"We use highly-protective software to check possible attack on our automated system," he said, adding the bank is also "alert" against possible online racket.

"We have sophisticated firewall in our server. But so far our electronic banking service hasn't had any attack by hackers," he said.

DBBL DMD Abul Kashem Md. Shirin said since last year the bank began replacing all its magnetic strip-based debit and credit cards due to "security concern".

"Those chips are risky for the card-holders as a hacker can enter into the chips and get all information. We have started to use micro-chip in the credit and debit cards," he said.

"We preserve the Personal Identification Number (PIN) and account information of the card-holders through encrypted files in our server, which makes it very difficult for a hacker to enter," Mr. Shirin added

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