ReadiMinds has released the results of second annual Middle East (ME) online security survey titled “State of Online Security in Financial Institutions in Middle East – 2009”. The survey respondents represented a cross section of ME’s major banks primarily focussing on the issues pertaining to transaction security, online financial fraud prevention and real-time risk mitigation.
According to the survey, 75% of respondents rated their own financial insitution’s ability to counter online security threat as average. Internal frauds remain major source of concern in the ME region. External frauds however are the fastest growing area of online fraud.
Almost all respondents reported that their financial institutions were victims of online fraud(s) during the year. ME financial institutions are still taking ‘fraud-wise/channel-wise’ approach to tackling online frauds, as opposed to taking holistic financial crime surveillance approach across channels. However, 50% of respondents showed strong desire to implement enterprise wide holistic cross-channel financial fraud prevention moving forward.
Over 70% of respondents preferred real-time fraud detection & prevention as opposed to traditional cooling/review period based approach. Over 75% respondents claimed to have known that an integrated multi-layered security consisting of stronger user authentication, cross-channel fraud detection and risk-based transaction authorization is the strongest form of defence against identity theft and online financial frauds – both traditional and emerging ones.
70% respondents rated efforts of their financial institutions to tackle online branch banking frauds as average. Over 50% of respondents would like to implement real-time operational risk monitoring and mitigation framework. Online financial fraud prevention, real-time risk visibility and regulatory compliance were the top most security and risk agendas during the year. There is an increasing desire to take a holistic approach to transaction security, that of preventing financial crime across channels across the enterprise.
Naren Nagpal, CEO of ReadMinds, said: “We have seen marked improvement in awareness of challenges posed by online threats – some of it is probably the result of couple of high-profile regional fraud cases widely reported in the media during the year. It seems the region mostly uses basic channel-wise transaction security primarily targeted for identity theft, as opposed to prevent broader online frauds.
“It is obvious there exists an excellent opportunity to leap frog and adopt real-time, integrated, multi-layered, cross-channel Financial Fraud Prevention as opposed to doing a catch-up with traditional piecemeal fraud/channel-wise approaches – afterall online fraud is borderless!”
Singapore-based ReadiMinds is a transaction security and online fraud prevention software product company that offers solutions for the BFSI industry.
