Studie - Security in Online Banking (Strategic Focus)

Introduction

Online banking continues to evolve, both in terms of customer uptake and the sophistication of the offerings. Datamonitor looks atthe security issues at the current state of play with regard to the technology to address them

Scope

*Online banking

*Authentication, b ehavioral analysis and other security technologies

Highlights

Internet banking is on the increase, in terms of both the number of people using it and the variety of transactions being carried out. This is leading to a requirement for greater security in the authorization of online customers and greater integrity in their banking sessions.

Reasons to Purchase

*Gain an insight into the evolution of online security

*See how banks are seeking to complement authentication technology with things like behavioral analysis

Overview 1

Catalyst 1

Summary 1

Key Messages 3

Online banking has grown, as has the range of things that customers are doing online 3

Banks are increasing IT spend on online services and online security this year 3

There are opportunities in client-side and back-end authentication technologies 3

The US has a broader definition of 2FA/MFA than Europe 3

Mobile phones are gaining traction as a channel for delivering a second factor 3

A tiered approach to online security is advisable 3

As phishing increases banks will need to do more on reverse authentication 4

User education will be required for some types of technology 4

Table of Contents 5

Table of figures 6

Market opportunity 7

Online banking has grown, as has the range of things customers are doing online 7

More account holders are banking online 8

More account holders are transferring funds online 9

The increasing popularity of online banking raises its profile for fraudsters 9

Banks are increasing IT spend on online services and online security this year 10

There are opportunities in client-side and back-end authentication technologies 15

Technology Evolution 16

Adoption of 2FA/MFA has varied markedly by region 16

Europe was first to adopt 2FA 16

Initiatives in Asia Pacific got underway mid-decade 17

In the US, the FFIEC called for the implementation of 2FA, but was not prescriptive about the type of technology 18

The US has a broader definition of 2FA/MFA than Europe 18

The FFIEC's non-prescriptive approach has spawned alternative technologies in the US 19

Mobile phones are gaining traction as a channel for delivering a second factor 19

Customer Impact 20

Online security must be integral to banks' business 20

A tiered approach to online security is advisable 20

As phishing increases banks will need to do more on reverse authentication 21

User education will be required for some types of technology 21

Competitive Landscape 22

Client-side technologies 22

ActivIdentity 22

Authentify 23

Commerce Media 23

CRYPTOCard 23

Fronde Anywhere 24

Gemalto 24

GrIDsure 24

IBM 25

PassFaces 25

SafeNet 26

SecurEnvoy 26

Thales 27

Vasco 27

VeriSign 27

Vett 28

Back-end technologies 28

ACI 28

Entrust 29

Ericsson 29

Guardian Analytics 29

Iovation 30

Quova 31

RSA 31

Tier-3 32

Go to Market 33

Recommend a mixture of technologies 33

Disruption to existing infrastructure is to be discouraged 33

Banks will need help with user education 33

Delivering technology as a service will appeal to smaller US and German institutions 33

Channel partners will be key in such accounts 34

Countries with greater banking concentration prefer to buy products 34

The fight against fraudsters will go on, so a long game may be in order 34

APPENDIX 35

Definitions 35

CAPTCHA 35

IP geolocation 35

Man-in-the-middle (MITM) attacks 35

Man-in the-browser (MITB) attacks 35

One-time password (OTP) 36

Out-of-band authentication (OOBA) 36

Transaction Authentication Number (TAN) lists 36

Two-factor authentication/Multi-factor authentication (2FA/MFA) 37

Methodology 37

Further reading 38

Ask the analyst 38

Datamonitor consulting 38

Disclaimer 38

List of Figures

Figure 1: Percentage of US adults who 'do some internet banking' (i.e. not necessarily daily) 9

Figure 2: European banks' investment priorities for payments in 2009 11

Figure 3: North American banks' investment priorities for payments in 2009 12

Figure 4: European banks' channel investment priorities for 2009 13

Figure 5: North American bank's channel investment priorities in 2009 14

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