I recently moved to the USA, and was shocked to see the lack of security in terms of financial transactions? Anyone who has my bank account and routing number can easily drain all the money from my bank account. Back where I come from, 1. Bank accounts have a net banking account used for online transactions and transfers, which requires a strong personalised password. 2. For online transactions using card, either a 3D secure password or a OTP (a unique One time password sent to your cell phone as a text for each online transactions) is required to validate the transaction. In the US, none of the two above security measures exist. In case you have given checks to anyone, you always stay at a risk of fraud as anyone can easily use that account and routing number for online purchases or transfers. Though the banks can refund you the money, but do I really need to go through this hassle? And most important of all, how are banks even allowed to operate with such a busted system. Personally, I am always scared when paying by check or doing an online transactions, as someone may always be hacking around ready to steal your money. Cant this system be fixed?

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    Why do you think there is a problem? Your account number, as you say, is on every check you write. And Americans write more checks than most of the world. I'm sure if it were really the problem you seem to think it is, that things would change very quickly. – Peter K. Nov 4 '16 at 19:07
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    Simply knowing an account number and routing number does not allow one to withdraw funds from that account. – user41790 Nov 4 '16 at 19:09
  • Dinesh - it is astounding how primitive security is in the US, it's true. (They're going to start using pin numbers with cards any day now...) There's no point getting excited or worried about it though: evidently the US works fine on the whole. (If you're from India, you must know there are epic cultural/infrastructure differences between the two: food and dancing is incredibly bad in the US; roads and paperwork is incredibly bad in India - and so on! Not a big deal.) – Fattie Nov 5 '16 at 11:41

Outside of the general rant contained within your question, the core itself can be answered relatively easily:

If you are concerned about the security of your payments, consider paying by credit card only, whenever possible. Particularly online, if you have a credit card with a low $ limit, this will prevent the damage that can be done to you if your financial information is stolen. Further, credit card companies generally have pro-customer policies which allow you to contest any fraudulent charges, and have them reversed.

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  • It's a good tip. – Fattie Nov 5 '16 at 11:42

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