NAB reveals it will scrap passwords in major upcoming change to its online banking amid digital boom

The future of NAB’s online banking is set to pivot from passwords to passkeys and biometric recognition technology.

The major bank revealed it would move away from passwords, calling the notoriously weak cybersecurity measures that fail to consistently an onslaught of cyberattacks.

The bank’s digital subsidiary ubank can already be unlocked with a passkey, and NAB said its online bank would operate similarly in this way within the next few years.

NAB chief security officer Sandro Bucchianeri said the bank’s strategy is to balance security with usability.

Get too technical, and users will forgo the safety measures for a simpler alternative, but make it too easy, and the bank leaves customers at risk of devastating losses.

Because a password needs to be simple enough for you to remember, is it also often simple enough for malicious actors to guess or secure.

Passcodes instead use fingerprints, faces, or secure codes on customers’ phones.

The passcodes to unlock accounts for NAB’s subsidiary currently require a device that supports and is upgraded to iOS 16 or later, or an Android 9 or later, and a device that has either a pin or FaceID screen lock.

The passkeys are then generated within the phone settings.

“As Australia’s largest business bank, we recognise and understand the important role we can play — alongside government and industry — in the fight against malicious cyber activity,” NAB Chief Security Officer Sandro Bucchianeri said.

“When it comes to cybersecurity and the use of passwords, vigilance is key.

Trying to strike the right balance between security and usability is something we’re constantly striving to achieve, but we will always put the security of our customers, and the bank, first.”

‘Digital banking boom’

The NAB announcement comes as the RBA revealed digital payment data in its monthly snapshot for the first time on Monday, showing just how large the surge in digital banking has been.

More than 500 million payments were made using mobile wallets in October, totalling over $20 billion, RBA said.

ABA CEO Anna Bligh said: “Australia is well and truly in a digital banking boom.”

“Go back a decade, and almost no one was making a digital wallet payment. Now we’re seeing over half a billion payments being made with mobile wallets in just one month.

“With the ongoing surge in digital payments, it’s critical these transactions are subject to the same oversight and consumer protection laws as the rest of the payments system.

“That’s why the ABA supports legislation currently in the Parliament that will ensure Australia’s payments regulatory framework remains fit-for-purpose and covers new entrants into the market.”