As an immigrant in the UK, you may send money to loved ones back home. Although you may be very comfortable making these transfers, that doesn’t mean they have no risk at all. Fortunately, it’s easy to keep your financial transactions secure when you use two-factor authentication.
Adding this extra layer of protection to your banking or financial apps, like Remitly does, makes it much more difficult for unauthorised users to access your account.
In this guide, we’ll take a look at what exactly two-factor authentication (2FA) is, how it works, and how you can make the most of it to keep your transactions safe.
What is two-factor authentication?
Two-factor authentication, or 2FA, is a type of multi-factor authentication (MFA) that helps protect your online accounts. It’s a security measure that requires you to take two different steps to confirm your identity before you’re able to take any action.
Many apps and services use 2FA to keep your personal and financial information safe. It’s especially common in banking apps, money transfer apps, and other platforms where security is a top priority.
For example, when logging into your banking app, you might first have to enter your password and then input a one-time code you’ve received via SMS or email to confirm it’s really you. Some apps also use authentication apps or biometric verification, like fingerprints or facial recognition, to add another level of protection.
Requiring 2FA instead of just one step makes it much more difficult for someone to access your account, even if they manage to steal your password. This added layer of protection is crucial when you’re sending money or managing your finances online as it keeps your transactions secure.
2FA compared to single-factor and three-factor authentication
Single-factor authentication requires just one step, such as inputting your password, while 2FA adds an extra layer of security on top. Then there’s three-factor authentication (3FA), which takes it a step further and requires three steps to verify your identity.
Banks and financial institutions sometimes use 3FA for highly sensitive transactions, such as transferring large sums of money or accessing corporate accounts.
While 2FA is generally enough for everyday banking, 3FA offers even stronger protection, reducing the risk of fraud and unauthorised access. However, because it adds another step, it’s usually only used in cases where the highest level of security is needed. That means you’re unlikely ever to need it when using your banking app on a day-to-day basis.
How does two-factor authentication work?
With two-factor authentication, you have to prove your identity in two different ways before you’re allowed access to your account. There are three main things usually used to do this:
- Something you know
Also known as the knowledge factor. This first layer is typically a password, PIN, or security question. It may ask you to answer a question you’ve set up before, like the name of your first pet. - Something you have
This is the possession factor. It refers to a device, like your mobile phone, that can be used to authenticate requests—usually a push notification. - Something you are
The biometric factor requires you to use a physical attribute, like your fingerprint or face, to confirm your identity. You’ll touch a fingerprint reader or look at a camera to gain access.
Most banking and money transfer services use a combination of these factors to verify your identity before allowing access. For example, when logging into your money transfer app, you might enter your password—something you know. Then you’ll receive a text message on your phone—something you have—containing a one-time passcode to type in.
Time and location count too
Location can also play a role in 2FA. For instance, if you start a transaction on your laptop but authenticate using your mobile device, both should be in a similar location. This prevents someone from remotely trying to access your account while you’re somewhere else.
Time also matters. Authentication codes often expire within a few minutes to reduce the risk of unauthorised access. If you miss the window, you’ll need to start the authentication process again.
The Benefits of Using 2FA in Banking
The main benefit of 2FA is that it makes it much more difficult for an unauthorised person to access your banking app and accounts. This makes it one of the most effective ways to secure your accounts and transactions. Overall, there are plenty of reasons why 2FA is in such common use:
- Increased security
With two layers of protection, your accounts are far less vulnerable to hacking attempts than with just a password. - Reduced risk of unauthorised access
Even if someone steals or guesses your password, they can’t access your account without the second authentication factor. - Instant alerts for suspicious activity
If someone tries to log in, you’ll receive a notification or authentication request and be able to take immediate action. - Peace of mind
Knowing that your money and personal information are protected makes online transactions less stressful. - Better protection for sensitive information
Two-factor authentication helps keep your financial apps secure to ensure that your sensitive data isn’t exposed. - Easy to use and widely available
Many financial apps and online services now offer 2FA as a standard feature, making it simple to enable and use.
What type of security risks does two-factor authentication guard against?
Cybercriminals are constantly finding new ways to break into accounts, from common scams to increasingly sophisticated methods to steal passwords and personal information. Two-factor authentication adds an extra layer of defence, making it much harder for them to succeed.
Phishing attacks
A phishing attack happens when cybercriminals get you to hand over your personal information by posing as a trusted company. For example, you might receive an email that looks like it’s from your bank, asking you to click a link and enter your login details. When you do this, the fraudsters can access your accounts.
Even if scammers manage to steal your password, 2FA can stop them from accessing your account. Without the second authentication factor, like a one-time passcode, they won’t be able to complete the login.
Account takeover attacks
When fraudsters gain unauthorised access to an account, change your login details and lock you out, it’s known as an account takeover.
One way that 2FA helps prevent this is by notifying you of unauthorised login attempts. If someone tries to access your UK bank account from an unfamiliar device or location, you’ll receive a prompt to approve or deny the login. This system gives you the chance to stop fraudsters before they take control of your account.
Brute force attacks
A brute force attack is when cybercriminals use automated tools to guess your password by trying countless combinations until they find the right one. This method is usually the most successful against weak or commonly used passwords.
Two-factor authentication stops brute force attacks by adding a second layer of security that can’t be guessed. Even if a hacker’s tool cracks your password, they still need access to your OTP or some physical attribute that they can’t copy remotely.
Lost or stolen devices
Losing your phone, tablet, or laptop can be a major security risk, especially if you’ve saved the login information for your accounts on your device. If this is the case, someone who finds or steals your device could access your banking apps or other sensitive accounts.
This is far more difficult to do when you have 2FA enabled. Even if someone has your phone, they would still need your password and another factor to gain access.
How UK banking apps use two-factor authentication
Most UK banking apps rely on 2FA to protect customer accounts and prevent fraud. Whether you’re logging in, transferring money, or adding a new beneficiary, your bank is likely to require more than just your password to authenticate your action.
We’ve talked about one-time passcodes, fingerprint scanning and facial recognition. Some other authentication methods used by UK banks include:
- Authentication apps
Some banks use apps like Google Authenticator or their own authentication tools to generate time-sensitive codes. - Card readers
Some banks issue physical card readers that generate security codes, especially for high-value transactions or adding new beneficiaries. The PINsentry from Barclays is an example. - Behavioural biometrics
Advanced banking apps may track unique user behaviour, such as typing speed or touch patterns, to detect unusual activity.
Banks use these additional authentication steps to ensure that even someone who’s managed to get hold of your password won’t be able to access your account.
How to enable two-factor authentication in your UK banking app
Some UK banking apps will have 2FA enabled by default, while others may prompt you to set it up when you first log in. If your app doesn’t automatically enable 2FA, you can usually activate it in your security settings. Here’s how:
- Open your banking app
Log in and navigate to the app’s settings or security section. - Find the two-factor authentication option
This may be listed under ‘Security’, ‘Login Settings’, or ‘Two-Step Verification’. - Choose your authentication method
You may be able to select SMS codes, an authentication app, fingerprint or face ID, or a combination of these. - Verify your identity
The app may ask you to confirm your identity using your password, a security question, or a one-time passcode sent to your mobile phone. - Complete setup
Follow the on-screen instructions to link your chosen authentication method to your account.
Once it’s enabled, consider testing the setup by logging out and signing back in to ensure everything works smoothly.
Common Two-Factor Authentication Challenges and Solutions
Two-factor authentication is great for keeping your account secure, but there may be times when you run into issues. Here are some of the most common 2FA problems and how to solve them:
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- You don’t have your mobile phone with you
Not having your phone can make it difficult to log in if your banking app uses SMS codes or push notifications for 2FA.
When setting up your 2FA, be sure to check if your bank offers backup authentication methods, like email verification. Some apps also allow you to use a physical security key or a backup code, so it’s a good idea to store these securely for emergencies.
- You don’t have your mobile phone with you
- You haven’t received a one-time passcode
If you’ve requested an OTP, waited a while, and it hasn’t arrived, it could be due to network issues, a delayed message, or an incorrect phone number on file.
To fix this, check your internet or mobile signal, ensure your phone number is correct in your bank’s settings, and look in your spam or blocked messages folder. If the issue won’t go away, try resending the OTP or using an alternative authentication method.
- You’re travelling and don’t have access to SMS messages
When travelling, you might not be able to receive SMS-based OTPs. This can make logging into your banking app difficult.
To avoid this issue, set up an authentication app before you travel or check if your bank allows email-based verification. If you’re using roaming, ensure your mobile plan supports international SMS reception.
The Future of 2FA: Biometrics and AI
Passwords have often been the weakest link in online security. Some people are not good at remembering them, so they use the same password for everything or write them down somewhere they can be found. Others set them up too simply, so they’re too easy to guess or hack automatically.
So the future of 2FA and 3FA will be biometrics—we think passwords will eventually become a thing of the past. Fingerprints and facial recognition are not absolutely unbreakable, but AI technology is already being used to uncover fraudulent attempts to beat these technologies. AI can tell if it’s actually you looking into a camera, for example, and not a picture of your face.
Portable Digital Identities (PDIs) will also become much more common. Gartner has said that they believe 500 million people around the world will use a PDI in their smartphones by next year. Whatever new ways appear to secure your banking, we’ll be keeping a close eye on developments to ensure Remitly is as secure as it can possibly be.
Move Money with Confidence
Two-factor authentication is one of the easiest ways to keep financial transactions secure when you’re making international transfers from the UK or managing your finances across borders.
By adding an extra layer of protection to your accounts, it ensures that only you have access, helping to prevent fraud and wire money online safely, giving you peace of mind every time you send money abroad.
With secure authentication methods like two-factor authentication built into Remitly, you can move money around with confidence, knowing your security is protected.
FAQs
Do I really need two-factor authentication?
It’s a good idea to use 2FA on your banking accounts and financial apps. It adds an extra layer of security to your accounts by requiring a second form of verification beyond just a password. This drastically reduces the risk of unauthorised access, even if your password is compromised.
What are examples of two-factor authentication?
Examples of two-factor authentication include SMS verification codes, OTPs, push notifications on your financial apps, authenticator apps like Google Authenticator, biometric authentication (fingerprint or facial recognition), and hardware tokens.