Though online payments are convenient and quick, they have opened up transactions to the threat of cybersecurity attacks in which you can lose your money or personal details. One of the most recent cyber-attacks is the one on Capital One Financial Corp. that affected 106 million present, past and prospective clients and threatened the reputation of one of the leading financial technology companies. This and other cyber-attacks have led to online brokerage platforms handling millions of transactions daily to invest in measures that protect their clients when they pay or withdraw their cash.

Below are some of the leading security measures companies use to safeguard online trading transactions.

online security - financial transactions lock

The encryption approach

In encryption, data or plain text will be converted into ciphertext such that the information you enter when making payments is only available to you and the brokerage firm you are working with. This approach helps to safeguard information transmission while securing stored data. Though there are different encryption methods in cybersecurity, the most common ones for online payments are symmetric-key and public-key encryption. Public-key encryption has two keys, including a public and private key, whereas, in symmetric key encryption, the sender and receiver will use the same keys for decrypting or encrypting information.

Secure socket layer {SSL}

The SSL is currently the most common security model by brokerage firms that want to secure their online payment channels. The protocol will implement data encryption, server authentication, message integrity for TCP/IP networks and optional customer authentication. In so doing, SSL will prevent eavesdropping by hackers, forgery and tampering of information during the transmission of financial data between two applications. Though it is a traditional protocol, SSL is still widely accepted by e-commerce sites owing to its security provisions including integrity, authentication, encryption and non-reputability.

S-HTTP {secure hypertext transfer protocol}

In S-HTTP, cybersecurity for online transactions is enhanced through the empowerment of the HTTP internet protocol using digital signatures, public-key encryption and authentication. It enhances security by negotiating the encryption schemes between a client and the vendor’s server. S-HTTP is designed to seamlessly integrate and co-exist with HTTP. As such, it enables the highest levels of end-user security using multiple defense mechanisms.

SET {Secure electronic transaction}

This is commonly used by traders handling large monetary transactions like the online brokers you will find at . The SET approach, collaborated by VISA and MasterCard, authenticates merchants or cardholders while ensuring the confidentiality of payment data. It also defines the electronic security service providers and protocols for online transactions. The SET specification integrates digital wallet software, agent gateway server software, certificate authority software and merchant software to enable its interoperability across diverse operating systems.


In tokenization, a random string of characters replaces the sensitive information that a customer enters on a site to make payment such as his/her credit card number. The process reduces the risk of exposing sensitive data because if a hacker steals the token number, it will be useless to him/her without a decryption key. Tokenization will authenticate your details on a trading site without exposing information that opens you up to security issues.

Address verification service {AVS}

The AVS is a security measure that forms a part of a merchant’s request during transactions to prevent fraudulent credit and debit card transactions. The tool is designed to check whether the billing address that a card’s user provides matches the one linked to the card. A seller will receive a response code when you key in your card details to know whether your transaction has been rejected or accepted. If there is an address mismatch such as happens when another person is using your card or the information in misspelt, the transaction is canceled.

Updated operating systems

Securities trading companies are now cautious to stay current with security updates that protect their business networks. This is because hackers constantly come up with techniques that infiltrate security measures and automatic updates of security measures are essential. Updated operating systems allow companies to reduce the weak points through which third parties might gain access to their sites.

Most people believe the common myth peddled online that most traders fail without taking time to understand the causes of failure. In most cases, traders fail because they do not take time to research the best brokers or the right trading techniques. With the right approaches and broker coupled with the above security measures to protect your transactions online, you are sure to reap a tidy profit in securities trading today.


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