FCAC warns consumers against sharing banking information with third-party online services

par The IJ Staff | March 14 2018 09:45AM

Photo: Freepik

The Financial Consumer Agency of Canada (FCAC) is warning Canadians about the risks of disclosing their online banking and credit card information to third-party financial mobile applications and online services.

In a statement released March 13, FCAC observes that with the growth of the emerging fintech sector, consumers are increasingly using third-party mobile apps and online financial services, such as independent online lenders, financial aggregators and rewards programs.

May ask for user IDs and passwords

FCAC says that some of these companies use software to verify online banking and credit card information before a consumer can access their products or services and may require consumers to provide their debit card or credit card numbers along with their user IDs and passwords to confirm their identity.

Consumers are normally protected from unauthorized credit card and banking transactions made using their financial institution's online banking service. “However, by disclosing their online banking user IDs and passwords to a third party, consumers may breach their financial institutions' user agreements and be held liable for any losses resulting from unauthorized transactions despite any security measures the third party service may have in place,” warns FCAC.

Rule of thumb

"While we do not want to inhibit the advancement of new technologies, we want to ensure that consumers are aware of their rights and responsibilities when using these services. Rule of thumb: when in doubt, don't share your banking credentials," said Lucie Tedesco, Commissioner, FCAC.

"Review your credit card and banking user agreements carefully to determine whether sharing information with another party will result in losing your protection against unauthorized transactions, recommends Jane Rooney, Financial Literacy Leader, FCAC. “If you feel you are at risk, contact your bank immediately and change your online banking passwords."