Banks must do more to promote security among their online customers, the UK's finance watchdog has said.
Lloyds is trying out new measures to beat online fraud
The Financial Services Authority (FSA) made the call as it revealed half of internet users are either extremely or very concerned about the risk of fraud.
To ease safety fears banks should make more effort to educate web users about online security, the FSA said.
But it warned if customers were forced to foot the bill for online fraud 77% would stop banking via the web.
More than 1,500 people were quizzed about online banking for the FSA's Financial Risk 2006 report.
The study, which will be published on Wednesday, also showed that while many web users were protecting themselves, almost a quarter did not know when they last updated their security software.
"Most consumers recognise they have some responsibility for security but they are not necessarily following this obligation through," FSA financial crime sector leader Philip Robinson said.
"To tackle the losses associated with fraud, banks should continue to drive security and this must include educating consumers on the importance of protecting themselves."
It added that figures from industry body Apacs showed internet fraud losses rose to £14.5m in the first six months of 2005.
While admitting that the figure was "relatively low" the FSA did point out that the figure had more than trebled from the £4m lost in the same period a year earlier.
In an effort to curb the growing problem of online fraud banks are testing new security tools.
Lloyds TSB began trials of a new two-part security system last year to tackle scams where fraudsters hack people's PCs or use "phishing" emails to steal login details.
Around 30,000 customers were sent a keyring-sized security device which generates a six-digit code - which changes every 30 seconds - to be used alongside usernames and passwords.
"We recognise that many banks are already taking steps to engage consumers," Mr Robinson added.
"Initiatives like the 'Get Safe Online' campaign between the government and the private sector show consumer education is beginning to happen.
"But banks need to look carefully at consumer attitudes and whether their initiatives are effective in maintaining confidence."
Online fraud has also hit the headlines recently after reports that criminal gangs had stolen millions from the government through tax credit scams involving the Department for Work and Pensions and Network Rail.
Such frauds are carried out by criminals who steal an individual's name, date of birth and National Insurance number and use these personal details to steal money from the government by making fraudulent tax credit claims.