Mobile banking is a way for the customer to perform banking actions on his or her cell phone or other mobile device. It is a quite popular method of banking that fits in well with a busy, technologically oriented lifestyle. It might also be referred to as M-banking or SMS banking.
The amount of banking you are able to do on your cell phone varies depending on the banking institution you use. Some banks offer only the option of text alerts, which are messages sent to your cell phone that alert you to activity on your account such as deposits, withdrawals, and ATM or credit card use. This is the most basic type of mobile banking.
A more involved type of mobile banking allows the user to log into his or her account from a cell phone, and then use the phone to make payments, check balances, transfer money between accounts, notify the bank of a lost or stolen credit card, stop payment on a check, receive a new PIN, or view a monthly statement, among other transactions. This type of banking is meant to be more convenient for the consumer than having to physically go into a bank, log on from their home computer, or make a phone call. While all of this is true, some are concerned about the security of mobile banking.
Most experts advise against performing any large transactions over mobile banking, which is good advice. However, it is equally important to use an alphanumeric password and to keep your PIN safe. Change your password often, and do not use your pets' names, your child's name, or any birthdays. This advice applies to all passwords, not just those used for mobile banking. Though you are logging on to a secure server at the bank through your cell phone, you need to do your part to protect your information. For this reason, many banks are now sending one-time use passwords for an extra step in security.
A one-time use password might be sent to a cell phone or other device when you wish to log into your account. You will then usually need to enter both the password you have already set, along with the one-time use password, within a certain period of time. The one-time use password expires, naturally, after it is used once or after a time limit has passed. Using two passwords increases the security of the account, an important concern with mobile banking.