Kiwis flock to internet banking despite risks

Two out of three internet users now access online banking, despite New Zealand banks admitting the sites are exposed to frequent attacks.

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Figures made public by Nielsen Online Consumer Finance Monitor show online banking has experienced "phenomenal growth" with the proportion of users doubling in three years.

Nielsen spokesman Donald Sheppard said online banking had become mainstream with frequently used sites receiving more than half a million unique browsers a month.

"Once they use the internet, people of all ages adopt online banking with enthusiasm," Sheppard said.

"For younger people with internet access, online banking is the norm."

Sheppard said 80 per cent of those under 40 used online banking and it was becoming more common practice for older people, with 62 per cent of those over 55 logging on in the past month.

In New Zealand, 84 per cent of people over 15 have access to the internet and 71 per cent use the internet at least once a month.

On their last visit to an online banking site, 90 per cent of customers checked their account balances and about half transferred money or made payments online.

"On the whole, customers are very happy with the online banking sites they use - around eight in 10 rate their experience as very good or excellent, with ASB recording an outstanding result (87 per cent very good or excellent)," Sheppard said.

ASB had the highest proportion of customers - 85 per cent - who used online banking in the last month, followed by Kiwibank with 81 per cent and Westpac with 77 per cent, Sheppard said.

The figures from Nielsen Online were a result of interviews of more than 15,000 people during 2007.

Last month it was reported that a new virus - that had attacked 400 banks world-wide - was able to bypass New Zealand banks' two-factor online authentication, generally a user name and a pass-word.

The threat resulted in big New Zealand banks reissuing safety advice to their customers, which included running up-to-date anti-virus protection programs and regularly changing their passwords.

National Bank, ANZ, ASB, Kiwibank and BNZ all offer reimbursement for online banking fraud on a case-by-case basis. Westpac guarantees cover for all online banking fraud losses.

The banks were criticised last week after the release of the report for taking out information about consumers' security concerns. ASB has since released research showing 46 per cent of bank customers are "highly concerned" about online banking security.

How to avoid getting stung:

Review your bank's terms and conditions and consider if the security is adequate.

If you are getting rid of a computer, remember that data can remain stored on the hard-drive after it has been deleted.

Always log out when ending a secure transaction -- especially at shared internet terminals such as internet cafes.

Never give out your user name or password.

- © Fairfax NZ News