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Two-factor authentication boosts e-banking confidence

I was intrigued to hear last week that the UK banks are starting to view two-factory authentication as highly desirable, following positive feedback from early triallists.

Alliance & Leicester (A&L), for example, has reported as 22 per cent increase in active online bank account users since it started its two- factor authentication service in March of this year.

During April, A&L says it saw a 20 per cent increase in online transactions, something that the bank says translates to around a million quids a year in savings.

Over at Lloyds-TSB, meanwhile, the bank says it has seen a 21 per cent increase in e-banking activity since it started offering two-factor security in September, 2005.

Andy Muddimer, A&L's head of Internet banking, said that the bank has been surprised by its customers responses.

"When we launched this two-factor system we built a loss-avoidance business case, but there was a big increase in online transactions," he told reporters.

According to Muddimer, criminals are always looking for easy targets, but attacks have been few and far between on the A&L systems since two-factor authentication was introduced...