As technology continues to advance, Czech banks are actively encouraging their clients to embrace mobile banking applications. In a notable shift, some banks have already increased or are planning to raise the fees associated with confirmation SMS messages sent during online card payments or when logging into electronic banking. This pricing adjustment also extends to paper statements and branch payments, signifying a financial incentive for customers to adopt digital banking practices.

One such example is Moneta Money Bank, which initiated a charge of five crowns per SMS message for clients under 65 years old starting in October. The bank has justified this move by emphasizing security concerns. According to Moneta Money Bank, SMS messages were responsible for 95% of all fraudulent attacks on accounts in the previous year.

The security risk, according to the bank, primarily centers around logging into Internet banking. This process takes place on a single device and necessitates only a login name, password, and a confirmation SMS. The vulnerability lies in the fact that fraudsters can remotely target a specific mobile phone without the client’s awareness, sending themselves the confirmation SMS with the mobile key. In contrast, mobile banking applications are encrypted and feature integrated security measures that prevent remote authorization of transactions on behalf of the client, as explained by Zuzana Filipová, the bank’s spokesperson.

In a similar move, ČSOB has also started charging for SMS messages as of the beginning of November, with each message costing 2.50 crowns. However, the bank has exempted clients under 18 and those aged 65 or older from this fee. Additionally, disabled clients will not be subject to this charge.

The shifting landscape toward mobile banking is associated with increased costs for traditional banking methods, potentially impacting clients who have not fully embraced digital banking. The challenge for banks is to strike a balance between encouraging digital adoption and supporting clients who may be less tech-savvy or prefer traditional banking channels. It remains to be seen how these changes will influence different segments of the banking customer base in the Czech Republic.

Article by Prague Forum