Are Digital Banks Really Safe?

Fintechs, or digital banks, are no longer new to Brazilians. Data even show that they are already gaining popularity in traditional banks.

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  • In May alone, fintech apps had four times more downloads than traditional banking apps. However, even with this popularity, many still do not join digital banks because of security concerns — and incidents that have happened in the past, such as cases of information leaks, make people even more scared.

    It is normal for the public to be afraid of data leakage, or to question, if the institution goes bankrupt, what happens to the money stored in it. Insecurity is common, mainly due to the short lifespan of fintechs. A survey by MUV, in partnership with Power-Fi, revealed that 82% of respondents do not trust fintechs. Customers who already have accounts in digital banks are also suspicious, with some people being afraid to deposit their money in their fintech savings, choosing to keep them in traditional banks.

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    The truth is that there are risks in both digital and traditional banks. Talking is easy, isn’t it? Then follow the article to see why fintechs, the famous digital banks, are as safe as the old and consolidated financial institutions in Brazil.

    Reasons that make digital banks safe

    Central Bank Control

    The largest digital banks operating today in Brazil — such as Nubank, Banco Inter, Superdigital, Agibank, Next and Neon — are all, without exception, regulated by the Central Bank , which makes several demands before releasing the operation, including issues involving digital protection of transactions and user data.

    This guarantees security and serves to avoid any type of problem with the services online. A case that demonstrates this occurred in 97, when the Central Bank intervened in an action with the Bank Neon to ensure that no customer suffered any losses due to false news saying that fintech was going bankrupt.

    Any bank has to obey rules to operate

    Every bank must comply with the rules determined by the National Monetary Council (CMN) and, in the case of fintechs, the agency determined new rules, in the resolution 4658.

    These rules oblige virtual financial institutions to draw up a cyber security policy, with definitions of requirements for contracting data storage, cloud computing and processing services.

    In addition, rules also determine that fintechs must have increasingly robust controls and systems, constantly being updated, especially regarding attack resilience cybernetic ues.

    The internet has a lot of information about banks

    Sites like Complain Here, Procon, and Google searches can tell you everything you need to know about a fintech, from how it treats customers to possible scandals.

    The commercial here shows the grade which customers give to fintechs.(Image: Screen Capture/Dácio Augusto)

    And if you are in doubt whether the institution is real or not, just check the CNPJ, corporate name or company regulation on the IRS website.

    Data protection

    The protection of data is important to everyone. At fintechs, the best way to check if the institution is secure is to see if it protects transactions. This can be seen in the way a payment is completed, from a biometric authentication or something similar.

    Typically, trusted institutions also make use of secure browsing protocols, such as “HTTPS ”, in which information is encrypted to prevent eavesdropping and cyber attacks. Look for it in your address bar, and you can be more relaxed about security.

    Traditional banks are more digital

    Even traditional bank users are already being hit by the digital wave. The digitization of banking services is a path of no return, and that all institutions are joining. More and more offers and benefits in large and traditional banks, such as Santander or Banco do Brasil, are only available to those who use the applications or Internet Banking.

    In other words, the concern with security is not just about digital banks. Thus, there is a constant search and interest throughout the sector in improving defenses to offer users a more protected environment.

    User care

    But it’s not because fintechs already take several steps to provide security to customers that you, the user, don’t need to be careful. The defense of digital banks is a two-way street, where both the client and the institution have to protect the data. We have set aside some tips for you to do your part:

    Be careful with passwords

    Use secure passwords on your accounts. Okay, but what is this? Well, first it must be exclusive. Avoid using the same combination in more than one institution, because if the worst happens and your combination leaks, only one of the institutions will be at risk of giving your money to the wrong people.

    If yours concern is to remember all of them, nowadays there are several password managers, which can be installed on the cell phone and create strong, random and unique combinations for each account you use together with the app.

    Keep your devices and apps always up to date

    New update for your phone has come out but you have no memory Try to make space, as they are very important. Same thing on the computer.

    Updating Windows always fixes security holes that can later become problematic. (Image: Reproduction/ Network Encyclopedia)

    Updates always bring improvements and fix bugs in previous versions, making it difficult to break in and the exploitation of vulnerabilities by criminals. Even if it changes the device’s battery life, they are well worth the security improvements.

    Use antivirus and firewall program

    Using antivirus is one of those basic instructions for any computer user, but even so there are still lots of people who ignore this tip.

    Antivirus and firewalls from well-known and famous brands help keep your devices safe from most threats. Windows users, in these cases, have built-in programs that already help with prevention, but which can be reinforced with other programs on the market, such as McAfee, Norton, Bitdefender and Kaspersky.

    Users Mac also need virus protection. Avast, Sophos and Norton are some of the most famous brands that offer solutions for the Apple system.

    On the smartphone or tablet, whether Android or iOS, it is worth performing the same search for tools recognized in the Marketplace. Generally, brands that have computer protection software also provide versions for mobile phones.

    Suspect contacts outside the bank’s app

    Fintechs, in their applications, have an internal communication system with the user that will always be used in official conversations. If you have received a contact that says the bank outside the app, be suspicious and contact the institution.

    In addition, basic care is also important. Avoid accessing your account in environments that are not official of the bank or that you do not know, as in situations like this you may run the risk of suffering a phishing scam.

    If you have to access the account directly from a computer, keep an eye on the address bar, and whether it shows the page as a secure environment, usually represented by a padlock. If it is not visible, do not enter any personal information and close the site.

    Source: Fintech, Your Money, Your Digital Credit

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