If you’ve ever worried about the security of your bank account, you’re not alone. A recent study reveals that fraud is increasingly affecting bank customers, and it’s not just a rare occurrence. But the good news is that banks are stepping up their efforts to protect your money—and there are practical steps you can take to keep your account safe.
A study by J.D. Power found that nearly 30% of bank customers experienced fraud in the past year. These incidents ranged from unauthorized charges and stolen money to people unknowingly transferring funds to scammers through peer-to-peer (P2P) payment apps.
This rise in fraud is largely due to the growing use of P2P apps and the shift toward digital, impersonal financial transactions. As Jennifer White, senior director of banking and payment intelligence at J.D. Power, points out, “You would never hand $100 to a stranger, but that’s often what P2P payments feel like.”
Adding to the problem are massive data breaches—like the National Public Data breach—that expose billions of Social Security numbers and other sensitive data. Scammers use this information to impersonate banks, often convincing customers to hand over even more personal details.
“It’s easy to fall for these scams because they have so much of your personal information,” says Paul Benda, executive vice president for risk, fraud, and cybersecurity at the American Bankers Association.
Fraud Is Happening More Often—and More Than Once
The J.D. Power study, released on November 7, found that 29% of bank customers experienced fraud in the past year. Even more concerning, 45% of these customers were hit by fraud more than once. “It’s not just happening once,” says White.
Young people, especially those under 40, are particularly at risk. Although they are digital natives, they also use P2P apps more frequently, making them prime targets for scammers.
But there’s a silver lining: many customers are satisfied with how banks handle fraud cases. In fact, 92% of customers said they would continue banking with their institution if it successfully resolved a fraud issue. Only 17% said the experience left them with a negative impression.
Banks Are Fighting Fraud—But Are You Doing Enough?
Banks are investing billions of dollars in fraud prevention each year. However, the J.D. Power study found that many consumers aren’t doing enough to protect themselves. For instance, while 46% of customers said their bank had encouraged them to take action against fraud in the last 90 days, a quarter of customers admitted to doing nothing to secure their accounts during that time.
The most common preventive measure is reviewing recent transactions for suspicious activity. But experts say this is a reactive approach and doesn’t provide full protection. Simply checking your account after a fraud incident has already occurred isn’t enough to keep your information safe.
How to Strengthen Your Bank Account Security
While it may feel like fraudsters are always one step ahead, there are concrete actions you can take to protect your account from fraud:
1. Check Your Bank’s Security Center
Most banks offer a security center on their website or mobile app, where you can manage security settings and review protections available to you. It’s a good place to start to ensure you’re using the tools your bank provides to keep your account safe.
2. Use Strong, Unique Passwords
Avoid using easily guessable information like your birthday or pet’s name. Instead, create complex and unique passwords for each account, and consider using a password manager to securely store them. If you receive an alert that your password was part of a data breach, change it immediately.
3. Set Up Alerts
Take advantage of alerts that notify you about important account activity, such as large withdrawals, changes to your contact information, or failed login attempts. These alerts can help you spot fraud early and take action before it’s too late.
4. Enable Two-Factor Authentication (2FA)
Two-factor authentication adds an extra layer of protection by requiring two forms of identification—something you know (like a password) and something you have (like a code sent to your phone). Many banks also offer biometric verification, such as fingerprint or facial recognition, for additional security.
5. Keep Your Banking App Updated
Make sure your banking app is always up to date. Updates typically include important security patches to protect against the latest threats. Most apps will prompt you when an update is available, so be sure to install those updates promptly.
6. Go Paperless
Switching to paperless statements helps protect you from mail theft and reduces the risk of your financial information being intercepted. It’s also more convenient and eco-friendly.
7. Protect Your Smartphone
Your smartphone is a key access point to your bank accounts, so take extra care to keep it secure. Never leave your phone unlocked and unattended, and avoid handing it over to others, especially when making payments. Always complete transactions yourself rather than letting someone else handle your phone.
8. Be Cautious of Unsolicited Messages
Be on guard if you receive unexpected emails, calls, or texts that claim to be from your bank. Look out for red flags like unsolicited links, urgent language, attachments, requests for sensitive information, or pressure to send money via a payment app. If you didn’t expect the message, don’t click on any links or share personal details.
Stay One Step Ahead of Scammers
Global scam losses are expected to surpass $1 trillion this year, underscoring the growing scale of fraud. But with the right precautions, you can reduce the risk of falling victim to these scams.
While banks are doing their part to protect your account, it’s up to you to stay vigilant. By following these steps, you can strengthen your account security and make it harder for scammers to get through. The more proactive you are, the safer your bank account will be.