It’s hard to conceive that banking was once done – albeit successfully – without the aid of technology. For centuries, savings and withdrawals were logged in ledgers, while customers queued patiently in order to physically pay in or take out their money.
It’s incredible to think that the first cash point only came into operation as recently as 1968 and that the birth of internet banking was at least 20 years away. It was not until the early 2000s that the concept was adopted on a large scale by bank customers.
With all the clever banking technology that is now at our disposal, it seems impossible to imagine how business functioned prior to the advent of immediate online money transfers, or that individuals had to visit the bank for any financial-related activities. Yes, it is almost inconceivable that banking should have succeeded at all before the dawning of the technological age.
Fortunately in the 21st century, banking processes have become far simpler and more convenient. In fact, recent data reveals that as few as 11 percent of transactions actually involve the exchange of real money. Wages are paid via BACs directly into employees’ accounts. Bills are paid by direct debit to suppliers. Even foreign currency can be ordered online and sent straight to the door.
Naturally, the increased use and reliance on technology in the banking sector hasn’t been without its issues. The industry has had to implement a large number of security controls to prevent data breaches or file hacking, as a way to both guarantee and provide reassurance that customers’ money remains safe.
It’s a shame, therefore, when any very unusual ‘technological glitches’ occur to dent consumer confidence, a flame that is typically fanned by an unnecessary media frenzy. The media rarely reports on any of the many measures that banks take to keep services running smoothly and securely. If they did, customers would realize that passwords, unique log-ins and PINs are just the first step.
One such innovation is the payment gateway for banks. This e-commerce platform authorizes online transactions and payments, used when customers buy goods online using debit or credit cards. The payment gateway provides a double layer of security which can help to prevent card fraud.
When a customer has proceeded through the online check-out and entered their payment details, the online retailer effectively passes the transaction by the bank for its approval. In some cases, customers will be diverted to a separate web page, where they may be asked to enter a payment gateway password.
For banks, the payment gateway makes sure that personal information is encrypted and thus exchanged securely. Once all information has been verified, the transaction continues safely and the bank deposits the required funds into the retailer’s account. This process follows some strict protocols, using a secret password that is known only to the retailer and payment gateway.
In some cases, the gateway performs a check on the customer’s IP address. This means that anyone who attempts to make a transaction from an unfamiliar location may be stopped. The effect is an additional raft of security checks that takes place via the bank without the customer knowing.
The above is just one of the ways in which banks safeguard customers’ money and sensitive information. As such, compromises are rare and that is perhaps the reason why the national press whips up a media frenzy when it does happen.
Author Bio: Elliot Robinson has been a writer for a decade and has been contributing regularly for various finance blogs. He regularly keeps himself updated with recent trends in the financial market and shares various tips and tricks to run business successfully. He recommends you to visit First Atlantic Commerce.
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