The European Network and Information Security Agency (ENISA) has advised banks to presume that all customer PCs are infected given "the current situation" of security.
In an advisory last week, the EU cyber security agency noted that many existing authentication systems have failed to prevent fraud.
The agency highlighted Operation High Roller, where McAfee and Guardian Analytics indicated that hackers had made off with at least £47 million ($A71 million) in fraudulent transfers from accounts at 60 or more financial institutions.
"Banks should instead assume that PCs are infected and still take steps to protect customers from fraudulent transactions," the advisory said.
“For example, a basic two-factor authentication does not prevent man-in-the-middle or man-in-the-browser attacks on transactions.
"Therefore, it is important to cross check with the user [about] the value and destination of certain transactions, via a trusted channel, on a trusted device (e.g. an SMS, a telephone call, a standalone smartcard reader with screen).
"Even smartphones could be used here, provided smartphone security holds up.”
ENISA warned organisations not to take smartphone security for granted, especially as an increasing number of transactions took place on smartphones or tablets.
It said the rapid adoption of smartphones also offered an important opportunity to improve endpoint security - for example by using vetted app stores or smartphones as second factors.
Security blogger Brian Krebs called the advice "blunt, timely and refreshing", particularly for financial institutions.