In separate announcements, two of the UKs leading banks are making moves to protect their customers from identity theft and losing millions of pounds each year.

Barclays is introducing a new PINsentry for online users, while Nationwide has been working successfully to prevent its customers from being scammed by phishing.

The new PINsentry will replace passcodes and memorable words for users who make third party payments. Barclays is sending out handheld chip and PIN card readers that will be used with customer’s normal debit card and PIN, to authenticate their identity at log in and for making certain payments.

While Nationwide has been using MarkMonitor to shut down phishing attacks. The moves by the banks will begin to curb online threats. Phishing, the scam that imitates financial service websites to get users to log information, steal the data and collect money from personal and business accounts, is becoming big business for fraudsters.

New figures released by EMC, rank the UK as the second worst hit worldwide, hosting 10% of attacks. The US is still suffering the brunt of the scams, with 73% of brands receiving the attacks.

Phishing websites can look identical to bank login pages; it is advised customers use the actual URL for their bank.

The Anti-Phishing Working Group estimates that overall financial losses due to phishing top $1 billion per year.

A third party welcomes the moves, Raimund Genes, CTO Internet Security Trend Micro, commented, "Identity theft continues to rise. Consumer confidence in online transactions and online banking has been waning and better safeguards, such as biometrics or smartcards needs to be considered by other banks. We are excited to see a major organisation like Barclays taking more responsibility and providing a safer environment for their customers to do banking".