Open Access Research Article
PROTECTION OF BANKERS. BY: JYOTI AKSHAY MURHE
Published Paper
Article Details
PROTECTION OF
BANKERS.
AUTHORED BY: JYOTI AKSHAY MURHE.
LLM, II
(2022-23)
ROLL NO.50
1. Abstract
The arrival of computers
has led to the creation of Information Systems which are being used as a
business tool extensively. Computers and more specifically information systems
are used in a large scale from almost every single enterprise. The application
of the dynamic potential of information systems and technologies has brought
various improvements in business activities. One of the most important sectors
which takes advantage of the constant rise of informational systems are the
banking institutions. The nature of the banking sector as in other industries
related to financial institutions, includes the use of terms such as
information and trust. As a fundamental part of the industry of services, banks
need the most information they can acquire. In the financial level, the role of
an information system is far more complex, due to its position in the chain
value, where the need for advanced information systems, which will allow the
function of a large volume of information in different stages of processing, is
granted. Furthermore, for the banking institutions and their clients, it is
indispensable to have security, accuracy and data availability, terms which
contribute to the automation of Information Systems. The basic services include
the recordings of client’s audit books, whereas the most complicated include
the possibility of an interactive voice recording through which clients can
receive answers through the frequently asked questions application. However,
the development of an information system requires substantial investments, the
responsibility of not leaking information and different other security
measures. Therefore, banks need information in every stage of their activities.
The benefits of information are many. Today, the decision making systems are
used also by banks for purposes of commercial use of new loans. Typically,
banks tend to need information in several levels analyzed in the paper.
Keywords: banks, bank security, information systems
2. Introduction
.The objective of this paper is to
present the measures for the protection of banking and information systems. The
development and evolution of computers has led to the creation of Information
Systems which are being used from the personal level, to businesses, to
organizations, to whole countries. In the business sector, information systems
are used by almost every single enterprise as a business tool in a large scale.
Computers and more specifically Information Systems are used in a large scale
from almost every single enterprise. The application of the dynamic potential
of information systems and technologies has brought various improvements in
business activities in terms of production, financial management, accounting,
organizing clients and suppliers etc. One of the most important business which
takes advantage of the constant rise of technology in informational systems are
the banking institutions. The nature of the banking sector and more general
financial institutions, includes the use of terms such as information and
trust. In this sector, a huge amount of information is processed all the time.
Furthermore, for the banking institutions and their clients, it is indispensable
to have security, accuracy and data availability, terms which contribute to the
automation of information systems.[1]
The need and importance of the consumer protection is
expanding at a rate of knots especially in the Indian banking sector. We have
encountered many incidents in the banking sector where the consumers are misled
due to the failure of bank's operational capacities leading to the financial
insecurity amongst the innocent customers. The recent example is the Punjab and
Maharashtra Co-operative bank issue, wherein, the Reserve Bank of India ("RBI")
under Section 35(A) of Banking Regulation Act, 1949 imposed the regulatory
restrictions and withdrawal restrictions upon the said bank due to its
irregularities disclosed to the RBI, which in turn has affected the faultless
customers[2]
The banking institutions have as their object
investments, commercial and depository activities amongst which are the
following: the attraction of financial assets from the public and the
appropriate financial carriers with the form of depositions, granting loans,
payments and transactions in a foreign currency, transaction activities such as
the exchange of coins, and offers in a foreign currency. Theinformation system
of banking institutions has to assure the execution of these specific
activities, but also has to fulfill some basic requirements. As an
indispensable ingredient of the sector of services, banks need to store
information in order to improve the level of their services and to acquire a
competitive advantage in regard to their competitors. More specifically, new
technologies such as cloud computing and other storing systems of data which
are based on the internet, have allowed to the banking institutions to grant
their clients state of the art services, preserving however the competition of
the financial market which is required during the practice of their business
activities. The basic services include the recordings of client’s audit books,
whereas the most complicated include the possibility of an Interactive Voice
Recording through which clients can receive answers through the frequently
asked questions application. However, the development of an Information System
requires substantial investments, the responsibility of not leaking information
and different other security measures. Therefore, banks need information in
every stage of their activities. The benefits of information are many: Today,
the decision-making systems, are used also from banks for purposes of analyzing
the credit history and credibility of every applicant (individual or business)
before granting them new loans.
3. Definition of Banking:
Banking is defined as
accepting – for the purpose of lending or investment – deposits of money from
the public, repayable on demand or otherwise and withdrawable by cheque, draft
or otherwise. A banking company is defined as a company registered with the
authorities for carrying on the business of banking.
Industrial enterprises
accepting deposits for financing their activities are expressly excluded from
the definition of banking companies. A company carrying on the business of banking
must contain a term like bank, banking, banker, etc., as part of its name.[3]
4.
Appraisal of protection in banking information systems
All
the banks in western countries and more recently in Asian countries use
Information Systems in order to exist and operate in the global markets. The
tools of decision making, administration systems of accounts and systems which
are based upon the internet are being widely used from banking institutions in
order to operate regularly and attract new customers by being ahead of their
competitors. However, the main problem of on-line applications which they
provide is the level of security. Security constitutes an essential requirement
for the ensuring of normal functionality of a banking institution. By nature,
it does constitute a dynamic and not static parameter and subsequently will
have to be constantly reexamined and reevaluated with the goal of improvement.
With the term “security of banking information systems” we mean the ability of
a banking institution to provide reliable and trustworthy information which can
also be accessed by anyone interested anytime.[4]
In order to
accomplish this goal, protection of integrity and confidentiality of data is
required as well for the constant operation of an information system center.
Furthermore, the
safety of banking information systems is divided in two major categories:
4.1. Safety in everyday
transactions
The most common
threat for on line users of banking applications is the theft of security codes
(pin) and their electronic cards or the theft of usernames and private banking
accounts passwords and subsequently the loss of money. The truth is that there
is no perfect system. Every system has its weakness as it includes programming
and decoding. However, recently many banks have taken precautionary measures so
as to have secure online banking transactions through the use of computers and
Information Systems. The new security systems include the Secure Sockets Layer
(SSL) technology as well as systems of memory which use access codes.
Furthermore, the providing of extra information as well as the providing of
access codes in specific telephone numbers is planned. As regards internet
banking, this makes available all the security issues for its application and
for its transactions as for example authentication through a multichannel
personal identification number (PIN), random generated positions from the
system for every connection, daily maximum limits for everyday transactions.
More specifically, safety in everyday base of banking transactions can be
implemented initially through the natural security of banking Information
Systems. If, however, the right measures will not be taken properly, there is
the danger of malfunction or even destruction of hardware and subsequently loss
of vital information.
4.2. Interception
Interception
constitutes a form of passive attack against the confidentiality of Information
Systems from a person (hacker) or a program or a mother computer system. The
accumulation of a large quantity of electronic information regarding
individuals from banking institutions, public services and private enterprises
in conjunction to the ability of computers to survey and total recording of
information for individuals, creates in our modern time period, an increasing threat
to private life. In addition, the protection of private life, of personal data
and in particular of sensitive private data is considered very important and
significant for every person (individual or organization). The term“personal data” includes every
piece of information which describes a person like the name, the surname, the
profession, the marital status.
4.3 Techniques of dealing with
Interceptions
The rapid development of technology in the field of
computer systems and the transmission of information has demonstrated an
important problem, the one of protection of the transmitted information and
subsequently that of the privacy of users. The basic technique used in order to
eradicate the problem of interception is that of cryptography. This method is
very easy in its application, follows typical protocols and keys of
cryptography and provides solid protection of data. For these reasons it is
preferred. Its goal is to ensure the integrity, authentication and
confidentiality of data during their transfer between the sender and the
receiver via the internet. More specifically, the data which are going to be
shared are transformed in such a form that it is difficult to be
interpreted and read if a certain sequence is not known. This sequence is the key
to solving encrypted data, in conjunction with the use of a suitable algorithm.
In order for someone to be able to obtain access in specific data, he has to
know the key. In our time, cryptography techniques offer data encryption in
application levels during their transfer between two computer terminals which
communicate through the Internet
5. Recent Development
in Banking Sector which has escalated the Consumer Protection.
It can be said
that Article 21 of the Indian Constitution is the main theme behind the
evolution of consumer protection laws in our country. The Right to Privacy is
the stepping stone of the consumer protection laws in our country because every
customer has the right with respect to their personal choice. At the same time,
the service providers have the inbound duty to protect the 'Right to Privacy'
of their valuable customers. Highlighting the same, the High Court of Kerala
referring to the case of District Registrar and the Collector v. Canara Bank3,
has held that, 'Demanding information about bank accounts without statutory
backings violates Right to Privacy.[5]
The Kerala High Court upheld the same by stating that the
demand of details pertaining to the bank account of a person shall amount to
infringement of Right to Privacy. So, this has created a positive hope amongst
the banking customers about banks which are now duly responsible in maintaining
the privacy of its customers and uphold the validity of Right privacy enshrined
in the Indian Constitution.
6. Role of Banks in Consumer
Protection
Banks not only
need to make sufficient disclosures on all aspects of their functioning and
operations but also have to play a proactive role in educating customers on the
products offered, the operational techniques, risks involved, safeguards and
redressal options available. Banks need to maintain transparency in pricing,
service charges, fees, and penalties. Every bank has to ensure the following in
order to build a secure environment for the customers:
- Limiting the liability of customers in unauthorised electronic banking
transactions.
- Enforcing ethical behaviour by financial service providers under the
regulatory purview of the RBI.
- Emphasis on "Consumer Education" - Advertisement campaign on
fictitious offers/fund transfers, coordination with the cyber-crime
department, etc.
- Spreading awareness about Banking Ombudsman in rural and semi-urban
areas.
- Improving the internal grievances redress mechanism of banks for
effectiveness and timely response.
- Sensitising frontline staff of banks on the importance of customer
service.
- Bringing about continuous systemic improvement by root cause analysis
of complaints.
- Review of the BO Scheme in the light of emerging changes in the
environment.
- Conducting thematic surveys and studies on specific areas.
- Monitoring implementation of the Charter of Customer Rights.
Conclusion:
In conclusion, we examined in this paper the
importance of the matter of protecting the sensitive personal data in the
Banking Information Systems. This topic is especially vital to the majority of
users throughout the world. As technology rapidly advances, new methods of
attempting to retrieve personal sensitive data from cards and accounts are
introduced. In the same way, new counter measures are also appearing. We can conclude
by expressing the belief that there does not exist a totally protected
Information System in the Banking sector or in any other sector. However,
through the process of experimentation and improvement on the existing systems,
we may come to the point where it will be extremely difficult for a potential
hacker to acquire access to the personal accounts of different users. Further
research is focusing on inserting personal biometric characteristics of an
individual in order to have access to his personal data. In this way it will be
very difficult for a potential hacker to invade the accounts of users because
the biometric characteristics of every individual are unique.[6]
References:
1. Adeoye, O.S. 2012, “Evaluating the
Performance of Two-Factor Authentication Solution” in The Banking Sector,
International Journal of Computer Science Issues, vol. 9, is. 4, no
.2, pp.457-462 2. Baker, R. 1991,
Computer Security Handbook: TAB Professional and Reference Books.
3. Back, A., Möller, U. & Stiglic,
?. 2001, “Traffic analysis attacks and trade-offs in anonymity providing
systems”, in Information Hiding, Berlin: Springer, pp. 245–257
. 4. Baxter A. 2015, How to stop
hackers from stealing your information on public Wi-Fi. (Retrieved in
23.09.2017). Retrieved from https://thenextweb.com/insider/2015/08/08/how-to-stop-hackersfrom-stealing-your-information-on-public-wi-fi/#.tnw_kXzFhIAJ
5. Dai, H.-N., Wang, Q., Li, D. & Chi-Wing
Wong, R. 2013, “Eavesdropping Attacks in Wireless Sensor Networks with
Directional Antennas”, International Journal of Distributed Sensor Networks,
vol. 2013, no. ID 760834, pp. 1-13
6. Davenport, T. & Short, J. 1990,
“Information technology and business process design”, Operations Management,
Vol.3, pp.11-27. 7. Laudon, K., & Laudon, P. J. 2012, Management
Information Systems (12 ed.)
[1] file:///C:/Users/OM%20SAI/Downloads/1536784638284211%20(6).pdf
[2] https://www.mondaq.com/india/dodd-frank-consumer-protection-act/865580/present-status-of-consumer-protection-in-indian-banking-sector.
[3] https://www.yourarticlelibrary.com/banking/law-and-practice-of-banking/99044
[4] file:///C:/Users/OM%20SAI/Downloads/1536784638284211%20(6).pdf
[5] https://www.mondaq.com/india/dodd-frank-consumer-protection-act/865580/present-status-of-consumer-protection-in
[6] file:///C:/Users/OM%20SAI/Downloads/1536784638284211%20(7).pdf
Article Information
PROTECTION OF BANKERS. BY: JYOTI AKSHAY MURHE
Authors: JYOTI AKSHAY MURHE
- Journal IJLRA
- ISSN 2582-6433
- Published 2023/06/17
- Issue 7
About Journal
International Journal for Legal Research and Analysis
- Abbreviation IJLRA
- ISSN 2582-6433
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