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Online Banking Guide | Update June 2016

America’s Safest Online Banks: How 20 New England Banks Stack Up

Compared to our European counterparts, Americans are slow to adopt online banking. Today, just one in two American adults bank online while, in Iceland, the number is nine in ten [1]. Most often, security concerns keep Americans away from depositing checks, viewing transactions and balances, or paying bills online.  
glassIn some ways, prudence has paid off for the American public. By avoiding online banking, for example, Americans stayed out of the international Icesave crisis of 2008, where Dutch and British depositors lost 7 billion euros in online accounts based in Iceland.

Clients derive a sense of security from accessing the place their money is physically kept, but there is actually no longer a need to be wary of online accounts. It’s not 2008. Today, online banking is as secure as visiting your local branch.  

In the United States, the FDIC guarantees funds in online accounts up to $250,000 (just like traditional accounts). Banks’ growing awareness of cybercrime has also generated an impressive list of best security practices to protect online accounts from hackers.  
Nowadays, if there is a security breach in online banking, it is usually on the client’s side. If the client’s device is infected with a virus that crawls messaging and emails or redirects the user from popular bank web addresses to malicious clone sites, hackers can gain access to client passwords.
Take advantage of the convenience of online banking, while also protecting your account from hackers, by keeping your devices virus-free and using one of the twenty banks below that implement best online security practices.  

The Criteria

  We reviewed and ranked a cross-section of New England banks based on their emphasis of the following best online security practices:

  • Secure login: Because hackers are more likely to target weak security on the client’s device than to target a bank directly, a complex login prevents hackers from easily accessing an account with stolen login information. Difficult security questions, verification images, and complex passwords increase account security.

  • Mutual authentication: Mutual authentication, a process that requires that the bank server verify its identity to the client simultaneously with login, prevents malware from obtaining the client’s username and password by imitating the bank website.

  • Firewalls: Programs that separate mass internet traffic from authorized bank transmissions is key to protecting the bank from cyber attacks on their side. Effective firewalls keep unauthorized data out of the bank’s network.

  • End-to-end encryption: Encryption, the practice of scrambling data sent over the internet to avoid interception, is an indispensible online security tool. It is one of the basic practices of online banking and every bank uses some form of encryption to transfer data discreetly. To check if a site uses encryption, look for the “https://” web address prefix and the green toolbar denoting the site has passed an external security audit.

  • Session time-out: To prevent a third party from taking advantage of a client who forgets to log out, sessions should time out after 20 minutes or less. Banks should not allow automatic login, particularly on portable devices that could easily be stolen.

  • Account monitoring: Banks that track client behavior can detect uncharacteristic spending and, therefore, block unauthorized transactions as they happen.

  We focused disproportionately on local banks for two reasons. First, big banks’ necessarily implement strict online security practices already. Second, hackers target big banks with malware schemes that, for example, redirect traffic on infected computers from the bank’s web address to a malicious clone. It is sometimes safer, then, to use a small online bank that is not an easy target for hackers.  
The following banks were chosen for a combination of online security and overall quality according to customer reviews. Of course, a good reputation was not enough to claim a spot on our list. We excluded several well-regarded New England banks because of security issues including lack of an Extended Validation certificate for the bank’s domain.

The 20 Best Online Banks in New England

  1. Ally Bank: Vermont’s Ally Bank implements a comprehensive online security system that includes secure login (two step), SSL 128-bit encryption, firewalls and anti-malware software to protect the bank’s network, and account monitoring (i.e. the system flags unusual account activity). It also offers Webroot SecureAnywhere software free to all customers. SecureAnywhere protects client devices from cyber attacks. Ally Bank security professionals also routinely monitor app stores for malicious clones of the Ally Bank app.  
2. TD Bank: TD Bank utilizes multiple layers of online security in its mobile banking program. The bank’s secure login includes behavioral analysis of when, how, and from where the client logs into their online account. Its firewalls include an Intrusion Detection System to identify security breaches. TD Bank Online Banking uses 128-bit encryption and Verisign experts provide mutual authentication. In addition, third party security consultants periodically evaluate TD’s security measures.  
3. People’s United Bank: People’s United Mobile Banking implements layered security measures that include 128-bit SSL strong encryption, secure login using either a PIN or password, and mutual authentication. A client must personally enroll all his or her devices in the mobile banking program to access his or her online account from that device.
4. Webster Bank: WebsterOnline Banking’s basic security features include secure login with a verification image to protect against malicious clone sites, firewalls, and the “highest level” of encryption. Clients may also register their devices with WebsterOnline Banking to enable mutual authentication, which increases online banking security significantly. Mutual authentication is, however, optional.
5. Rockland Trust: Rockland Trust Online Banking utilizes layered security measures, in accordance with best online security practices. The bank assigns new clients a one-time Secure Access code, preventing third party coopting right off the bat. The online bank also utilizes cookies to authorize client devices and 128-bit RC encryption to transmit requests.
6. First Niagra: First Niagra implements layered security measures that include 128-bit SSL encryption and secure login that includes security questions and a verification image. First Niagra also protects account information from hackers that make it through their multilayered online security by omitting bank account numbers from their online system, using nicknames to identify accounts instead.
7. Bangor Savings Bank: Bangor Savings Bank protects its network with firewalls, Intrusion Detection Systems, and anti-malware software. It also encrypts all lines of online communication between the bank and its clients, including email. Bangor Savings Bank also encourages clients to download Trusteer Rapport – security software that protects against attacks on client devices.
8. Citibank: Citibank employs 128-bit encryption for all interactions, additional authentication for sensitive requests like money transfers, a system of firewalls, account monitoring, and a date/time stamp that lets clients view the last time they, or anyone else, logged in to their online account. As a big bank, Citibank is a popular target for hackers. Online security is, therefore, a priority for Citibank.
9. Norway Savings Bank: Adhering to the “highest level of security available in the industry,” Norway Savings Bank Mobile Solutions uses secure login (including periodic security questions), 128-bit encryption, and account monitoring to protect the bank and its clients. The bank’s security system protects, especially, against attacks coming from international sources.
10. Key Bank: Key Bank uses secure login, firewalls, cookies, and the latest encryption technology to protect its clients from cyber attack and identity theft. The bank also employs accessible security professionals and encourages clients to liaise with these professionals if they have security questions or concerns.
11. Merchant’s Bank: Merchant’s Bank protects online accounts with SSL 128-bit encryption. The bank uses a double firewall to protect its network. Merchant’s Bank offers Trusteer Rapport – security software that protects against attacks on client devices – free to all its customers. It also includes helpful instructions on downloading and using the security software on PC and Mac, although the bank does not provide instructions on how to use the program on iOS and Android.
12. Citizens Bank: Citizens Bank uses secure login, firewalls, and encryption to protect its clients from cyber attack and identity theft. The bank also encourages clients to download Trusteer Rapport – security software that protects against attacks on client devices. Rapport addresses the weakest link in online banking security – vulnerable client devices. The program is available free to all Citizens Bank customers.
13. BankNewport: By searching through the fine print in BankNewport’s Access Agreement, we discovered that the bank employs 128-bit SSL encryption, risk-based managing tools, and mutual authentication to protect clients. It also uses out-of-band confirmation codes (i.e. the bank sends the confirmation code over a secondary client device) and account monitoring.
14. St. Mary’s Bank: St. Mary’s Bank uses, as all good online banks do, multiple layers of security. First, a secure login includes three levels of authentication: a login username and password, a verification image, and several security questions that pop up when the client uses a new device or makes an uncharacteristic request. St. Mary’s also uses 128-bit encryption and requires that all clients use a browser that supports encryption.
15. Eastern Bank: With Eastern HomeConnect, the bank’s online service, clients can pay bills, view 13 months of account history, and schedule bank transfers over an encrypted line. Eastern Bank also encourages clients to download Trusteer Rapport – security software that protects against attacks on client devices. Eastern Bank offers the program free to all its customers.
16. Enterprise Bank: As is standard, Enterprise Bank conducts all online banking communications using 128-bit encryption. Multifactor authentication and cookies prevent third parties from accessing your account remotely. Enterprise also provides downloads of Trusteer Rapport – security software that protects against malware attacks on client devices – to all clients free of charge.
17. Union Bank: Union Bank’s layered approach to online security includes secure login (two step, with security questions), 128-bit SSL encryption, and a bank network “anchored by industry standard security features” including, presumably, firewalls.   18. Northway Bank: Northway bank uses 128-bit encryption and requires that all clients use a browser that supports that level of encryption. The bank also uses a PIN lockout system to protect clients from cyber attacks. It encourages clients to report persistent requests for account information from third parties to the Customer Support Center.
19. Chase: As one of America’s largest banks, you can rest assured that Chase’s security system has evolved with the numerous cyber attacks hackers have made against it. The bank uses firewalls, temporary pins, and encryption to protect itself and its customers. The risk to banking online with a big bank is, of course, that well-known banks are more likely to be the objects of malicious schemes and cons.
20. Bank of America: Like other big banks, Bank of America’s security system has evolved with the high profile cyber attacks made against it. The bank uses secure login and encryption to protect itself and its customers. The risk to banking online with a big bank is, of course, that well-known banks are more likely to be the objects of malicious schemes and cons.  

Online Banking

New ATMs Use Phones Instead of Cards to Authenticate Customers

This year, a handful of national banks plan to introduce ATMs that dispense cash when you tap your phone on a wireless keypad, instead of when you swipe your card.

Smartphone getting cold hard cash from the Automatic Teller Machine

It’s a mobile wallet innovation that mid-western bank Wintrust Financial and national bank J.P. Morgan Chase have already begun successfully introducing in several cities across the United States.

These new ATMs might just be the innovation that bridges the gap between online financial management services, cash, and digital wallets. Customers have been quick to adopt convenient financial management services like remote deposit, but slow to adopt digital wallet technology, which many people see as redundant or unsafe.

The Idea Behind the Digital Wallet

A digital wallets is an online payment technology that lets a person pre-register their credit, debit, gift, and


It’s called a smart or digital wallet

loyalty cards so that they can efficiently make payments from a smartphone or tablet. Many financial service brands offer digital wallets, including big players like PayPal (Mobile), MasterCard (MasterPass), Visa (V.me), QIWI Wallet, and Allied Wallet.

Digital wallets combine the convenience of paying with cash (it’s faster to process, no PIN involved) with the ease and security of paying with a card (no messy change to sort out, no chance of losing paper money or having it stolen).

Customers Don’t Yet Demand Digital

A staggering 57% percent of consumers still do not know what a digital wallet is or how to use it, according to a


Market Force show 57% consumer don’t what digital wallet is

2016 Market Force study, and – for better or for worse – many do not care to find out. Since credit cards are already convenient and secure, many people don’t see the need to open and manage another account.

As of late 2016, very few American consumers make payments using a mobile wallet. Only 14% of the consumers that Market Force surveyed ever use a digital wallet, up just 2% from last year. The age group most likely to use a mobile wallet is 25-34 year-olds, who use services like PayPal Mobile and Apple Pay to make in-store payments, to “tap-and-pay” for purchases, and to conveniently store a loyalty card.

Even among those who use mobile wallet, it’s not typically the preferred payment method. A 2015 study by the credit card service company TSYS found that a negligible minority of consumers prefers to use a mobile wallet for in-store purchases. Consumers prefer, first, to use a debit card, second, a credit card, and, third, cash.

Like previous studies, the Market Force study concluded that, overall, consumers are far more interested in mobile financial management services than they are in mobile payment services.

Studies continue to show people prefer to visit the physical bank

It also concluded that people still like to visit a physical bank or, at least, to have the option of doing so. Only 3% of consumers use an online bank with no physical branch locations.

Banks are Slow to Innovate

In 2016, investors poured nearly $20 billion into fintech projects like the new ATMs. Despite efforts from banks like Wintrust and J.P. Morgan, however, most banks are slow to innovate. When banks do innovate, it’s usually in reaction to customer demands, and the demand for mobile wallet and similar technology just isn’t there.

A 2016 report by the business intelligence firm L2 analyzed the digital transformation of 70 financial service brands that operate in the United States. It found that, overall, banks were slow to adopt new online technology and, especially, to adopt new services like “Get a Quote” and “Find an Advisor.” Forty-four percent of the financial service brands that L2 looked at offered neither service to customers.

Wintrust and J.P. Morgan’s new ATMs, which Bank of America and Wells Fargo will also introduce in 2017, give customers the chance to get more comfortable using their phones where their cards ought to go. By integrating withdrawing cash and the mobile wallet, these ATMs help bring disparate payment methods into a coherent, single system.

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Online Banking

Harriet Tubman and the Future of Cash Currency

Last week, the United States Treasury announced that Harriet Tubman will replace Andrew Jackson as the face of the newly minted twenty-dollar bill. The decision removes from the bill a man who,   ironically, vehemently opposed the use of paper money in his day. It also honors a woman who, in the early 1800s, helped countless slaves escape to freedom on the Underground Railroad.   While Americans applauded the Treasury’s progressive decision, the role of cash transactions – and, therefore, the role of the twenty-dollar bill – is actually diminishing. While claims that the “end of cash” is at hand should be taken with a huge grain of salt, banks and money services, like PayPal, are offering an increasing number of digital payment methods that compete directly with cash.   Digital payment technologies that allow individuals to make payments without using a credit/debit card or a traditional money transfer are known as digital wallets. Many money services offer digital wallets including big players PayPal (Wallet), MasterCard (MasterPass), Visa (V.me), QIWI Wallet, and Allied Wallet.   Digital wallets basically allow users to pre-register credit, debit, gift, and loyalty cards so that they can efficiently make payments from a mobile device like a smartphone or tablet. Digital wallets combine the convenience of paying with cash with the ease and security of paying  

Digital payment methods will eventually replace the use of cash

  with a card (no messy change to sort out, no chance of losing paper money or having it stolen).   People can also make many transactions with a cryptocurrency like bitcoins. Cryptocurrencies are a more radical digital payment technology than digital wallets, since they essentially separate authority and money. No central authority, like, for example, a national bank, regulates bitcoins. Bitcoins are difficult to “mine” (a.k.a. program), giving them (at least theoretically) the same inherent value as gold or silver.   Since 2009, when programmers launched the first bitcoin network, hackers have launched a number of successful thefts of the currency/attacks on markets. The hacks resulted in the loss of millions of dollars’ worth of bitcoins over the last seven years. Of course, even virtual transactions in national currencies are vulnerable to hackers. Last month, hackers broke into the Bangladeshi government’s central bank computer system and requested that the Federal Reserve Bank of New York send almost $1 billion in loans to various fraudulent organizations throughout southern Asia. The hackers ended up successfully stealing $80 million before bankers discovered the hack.   A hack is, however, as difficult to pull off and as sporadic as an old fashioned bank robbery. Despite well-publicized digital heists like the Bangladeshi one might suggest, the idea that paper money is safer than virtual money doesn’t hold much weight. As Andrew Jackson himself pointed out, paper (just like code) has no inherent value.   Paper money may, in fact, ultimately be less safe than virtual currencies like bitcoin, since the legitimacy of national currency depends on a government’s backing. The up and down spikes in the value of the bitcoin has demonstrated that independent currencies  

Where is the balance? Cash or Bitcoin? Or both?

  are subject to the same (if not more intense) market forces as national currencies, but the legitimacy of cryptocurrencies is not directly affected by national politics.   Due to the adoption of digital payment technology, the twenty-dollar bill may not hold the importance it once did. Harriet Tubman will, however, undoubtedly be the face of countless financial transactions in the next few decades (at least).
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