A proposal for a banking solution to hacking

A banking solution to limit the damage from hacking of banking accounts.

I think there is a simple but effective solution for limiting the financial losses caused to a person's bank account in case it has been hacked through internet or through the hacking of his debit card/ ATM card etc.

The traditional way of withdrawing money was to go to a bank personally, fill up the withdrawal form, and submit it to the clerk along with your bank passbook. This method requires the account holder to be physically present in the bank, and hence is the most secure and effective against any modern types of banking fraud.


The other method is to issue a check for withdrawing money. The cheques have the signature of the account holder which is physically/ manually verified by the bank clerk against the  signature sample in their records.

The current and the most popular way of withdrawing money from bank accounts is through the ATMs, and through internet banking for bill payments, online purchases etc.

But the cost of these new facilities comes down heavily on the user when his account credentials are hacked or his credit/ debit card is stolen or cloned, and the hackers gain access to his bank account. His entire saving in that account is at risk.

As it stands today, generally people tend to keep all their savings in one bank account for the sake of convenience, and it has turned out to be a huge disadvantage when the bank account info is stolen by hackers.

No matter what precautions you take to keep your online banking credintials safe, or keep your credit cards/ debit cards safe, you always are at risk of getting it hacked at some point or other at some or other place. And it is beyond an individual's control to avoid being duped in this manner.

Even the additional safety measure to sms an OTP (one time password)  to user's mobile phone is being bypassed by hackers by compromising the mobile phone sim card of the victim.

Therefore banks need to come up with some innovative approach to this newly faced danger, that is about to wipe out the trust of people in online banking or in using ATM/ debit cards.

I am suggesting a simple approach that only banks can implement for added safety of their clients.

Instead of making the entire amount in a bank account accessible for transactions through internet or ATM/ debit card transactions, banks should allow the client to choose a fixed amount that will be made available for such transactions. If this simple measure is adopted, then a client can be safegarded against the risk of totally emptying his life's savings in the hands of hackers.

If the client needs more money made available for these transactions, then he/ she should personally go to the bank's branch and submit a request to add more amount from his account to be made available for online banking/ ATM/ debit card transactions. It should not be much of a hassle for the clients as one can predict the monthly requirements that needs to be accessed through these means, and he can make sufficient amount available at one time.

So the basic idea is that instead of keeping the entire amount in a bank account at hackers mercy, only a predetermined amount decided by the client should be made available for online transactions/ ATM etc. So even if the client's account is hacked his loss would be limited to the amount available for online transaction at that moment and hackers won't be able to touch the entire amount in his account.

I hope banking professionals would come up with something on these lines as an added security measure against the current threat that is causing some people loose their entire life's savings in the  hackers hands.

Before the banks would come up with something like this, we can take an added precautionary measure if it is possible in your country. In India we can have bank accounts in different banks. So if you have two bank accounts in two different banks, use one of the accounts for ATM/ online banking. And keep the other bank account strictly manually accessible in the old fashioned way. You can transfer some amount in the account that has ATM/ online banking features. You can do that physically or through use of bank cheques. In this way, you can keep your life's savings out or reach from hackers.