Internet loans – are they safe?
The ability to take out a loan over the Internet has revolutionized the entire banking system. In order to get Money from the bank, you don’t even need to leave the house anymore. A large number of people, however, especially those who approach new solutions with a huge dose of caution, are wondering if such operations come with increased risk of loan frauds? Is an Internet loan a good solution?
Internet loans – how to get them
Getting a loan over the Internet looks similar to doing so at the bank branch. The client files an application for getting funds for any purpose, and the bank, upon evaluating their creditworthiness, provides the final loan offer. A contract is concluded between the lender and the borrower, the payments in form of commissions and interests are determined, and income documents are requested (in most cases it only applies to those who are not the customer of the bank they are asking for a loan).
All it takes to be granted a loan over the Internet is a few mouse clicks – without many convoluted formalities – the bank provides the client with a form to be filled out online. Then about a dozen minutes from filling it out, the bank makes a decision on giving the loan and its conditions. Then the client confirms the offered loan conditions, over e-mail for example, and signs the contract via a courier or a verifying transfer. That’s because in online banking all operations confirmed by the account owner with adequate codes (send as a text message at the provided phone number, for example) are considered to be legally valid.
On one hand, it’s a huge convenience and time saving, but on the other such solution comes with the risk of loan frauds. If the account passwords and codes get in the wrong hands, there’s a huge risk of a third party taking out a loan in our name.
Internet loans and security
However, in order to increase their customers’ security, most Banks implement a loan operation two-step authentication method. It consists of verifying the borrower’s identity over the phone. The risk of loan fraud over the Internet is therefore at the same level as when it comes to getting a loan the traditional way, as even when it comes to the traditional methods of identity Verification based on ID document, there have been incidents of impersonating someone else.
Some people even say that using services of this kind is safer than going to the bank branch and coming out of it with a bag full of Money. Thieves are never asleep, though, even the virtual ones, which is why if we do make a decision to take out a loan over the Internet, it’s a good idea to ensure proper protection of the computer from viruses and programs trying to obtain account Access data.
When applying for a loan over the Internet, it is a good practice to:
- make sure if our computer doesn’t have any malicious software on it,
- limit the Access to the e-mail account for outsiders,
- regularly update the bank’s mobile app or the browser,
- verify the website address of the bank we are applying for a loan from – if it starts with the https:// protocol and is labeled with a locked padlock symbol, which is a proof of a secure connection,
- use difficult passwords for logging into electronic banking and change them regularly,
- check the details before sending the Verification transfer – there are viruses that can change the recipient account number copied to the clipboard,
- carefully follow the safety measures utilized by the bank.