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Do Banking Websites Need Special Web Hosting Services?

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From Internet Banking to Online Shopping, many people wonder whether banks use special hosting services or servers with better security. Over the years banks have started using a mix of various technologies to protect and secure their customer’s data from unauthorized or malicious activity. This article points out some ways in which your net banking transactions are protected by the bank.

Isolated Hosting

Do Banking Websites Need Special Web Hosting Services?

Do Banking Websites Need Special Web Hosting Services?

Banks mostly do not outsource their web hosting or application hosting facilities. They prefer to do everything in-house. This means that they actually allocate a room or maybe even a building to house their IT infrastructure. This is done to isolate all their systems from any interference or security threats. They maintain the servers in server room and have in-house staff to take care of them round the clock. This expense is highly justified especially when you compare the risk and liability involved in case of banking frauds. Some banks do outsource their backup systems to third party vendors, just to maintain a remote location backup to be on the safe side. All the information is securely stored on all servers handling the data. Even the Internet Connection given to banks is a leased line i.e. a line dedicated to the bank, which runs directly from the ISP to their facility. This ensures stable connectivity for the banks network and also helps ensure isolation from other traffic, interference or interception. Banks cannot use Shared Hosting, especially to maintain control and flexibility and also to ensure confidentiality.

Encrypted Records

All traffic to and from the banks servers are encrypted to prevent any leak of data or any compromise of financial information. Even between the main office and branches, the entire communication channel is encrypted and all messages sent through the network are immune to tapping by unauthorized persons. It would be disastrous if a message being relayed by a bank’s branch or bank officer is manipulated to cause a wrongful financial loss or gain to any person. This means that from the sender’s end right upto the receiving end, the entire communication needs to be secret. Conventional hosting may not be a good option for the bank as encryption systems and security mechanisms may not be standard across various hosts.


Backups are taken in different forms at different times. Many banks mirror the data on their servers in real time so that failure of any Hardware will not result in loss of data.  There is always redundancy in every aspect of the banks network. This means that every bit of hardware has a standby replacement ready for replacement incase the original fails. This minimizes downtime and helps the bank recover from a disaster. Banks also keep copies of the data stored outside their premises or in different locations or maybe even a different city, to help mitigate any risk of destruction or loss of the data. A Singapore based bank sends its yearly backups to its office in India, to ensure that in case of any natural or man made disaster hitting their locality or even city, their data is atleast safe and backed up. Banks are becoming more backup conscious especially in the light of the global terrorism scenario.

Security and Monitoring

Just like banks need physical security, their IT infrastructure needs virtual security as well. The places where their servers and data centers are located need to be secured and protected to prevent physical access to the information on the systems. Banks ideally have all their stored data in encrypted format, hence even if it is stolen, without the access credentials, the data will be junk for the thieves. Even if they can retrieve the files and documents, chances are that they wont be able to do much with them. Banks have a dedicated IT team to look after and monitor the resources round the clock. They may also outsource monitoring of their IT infra to various external agencies, incase they are handling some sensitive or country specific information on those servers. Apart from this, a team of network specialists is always on standby to initiate

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