Online banking systems in Germany

There are essential two systems in Germany. The most popular is the PIN/TAN system. Customers who travel a lot and want to use various PCs to do their banking will appreciate the advantages of the system using iTAN and mobile TAN. Customers communicate with their bank via the internet.

Customers wishing to bank online are given a five-digit code known as an online banking PIN. This code, together with the account number, identifies the customer to the bank's computer.

The bank also sends customers a list of different six-digit transaction numbers, called TANs. A customer wishing to make a credit transfer, for example, has to enter one of these TANs before the transaction can be completed. The TAN acts as a kind of online signature.

The banks have built on the PIN/TAN system and taken security one step further by developing what is known as the "indexed TAN", or iTAN for short. Customers no longer select a TAN from a list at random. The transaction can only be authorised by using a specific TAN requested by the bank.

If customers use just one computer to do their online banking, the Homebanking Computer Interface (HBCI), or its follow-up Financial Transaction Services (FinTS), will normally be used.

The HBCI was developed by the German banking industry. It offers a common standard for online banking from a home computer and makes data transmission independent of the open internet system.

FinTS stands for Financial Transaction Services, the follow-up to the HBCI standard, which was first published in 1996. From Version 3.0 of FinTS onwards, it will be possible for customers to authenticate transactions using the tried and tested PIN/TAN system as well as key-based systems.

FinTS therefore supports two different authentication methods: the PIN/TAN system and the electronic signature procedures currently used under the HBCI standard, such as chip card based signatures.