The most crucial, valuable, and sensitive data is stored in the financial sector. Any data breach can severely impact Personally Identifiable Information (PII).
A data breach is a prominent concern. The banking sector is facing physical, and now cyberattacks, severely impacting the reputation, trust, and brand image. Increased cases of hacking are bringing attention to re-examine the processes of dealing with cyberattacks in financial sectors. Being a leading cause of fraud at a crucial time when the world is going digital and most transactions are shifting to online portals, the urgency of re-examining where BFSI stands is becoming pressing. Moreover, with the advent of technically advanced and fast upgrading transaction channels digitally, a keen lookout on the cyber landscape is for the best. Preservation of client data, confidentiality, and integrity is the only source for utmost client satisfaction. Data suggests that financial firms are 300x more vulnerable to cyber-attacks and data breaches.
Philippe Lepoutre- Deputy Head of Global Transaction and Payment Services said “Cybercriminals increasingly act like corporates, with new product development teams and some organizations offering their services to or integrating them with those of other criminal gangs. Cyber-crime is more lucrative than other crimes, so banks must continue to invest a lot of resources into building defenses against it.”
Risks and vulnerabilities
One obvious reason to mark cybersecurity as important in the BFSI sector is to provide safe transactions and asset protection. If the servers are hacked, all the personal credentials and data of a person are exposed. This data can then be redirected to different locations and utilized in wrongful practices. The impact is equally harmful to financial institutions as it is for customers. Data recovery is a cumbersome process and might cost thousands of dollars to release the information. Additionally, the loss of precious trust leads to the loss of customers. If a customer is unsatisfied with the banking services or faces a breach of security they begin the process of shifting to a new bank which is lengthy and time-consuming. Although the funds are Federal Deposit Insurance Corporation (FDIC) protected, criminals, find a way to use the data. Three major risks associated with cybersecurity in banking include:
- Higher risks from Mobile Applications: Mobile phones have become an inseparable part of our lives. Banking apps are now a click away, however, there’s low security in using banking Apps on cell phones. A better end-user checkpoint is required to overcome this issue.
- Third-party payment channel breaches: The banks realized the predatory nature of hackers, increasing the security channels and services. The shift in hacking since has shifted to less secure third-party apps.
- Cryptocurrency hacks: cryptocurrency is gaining momentum in the market but cybercrime hasn’t left it untouched. The sector is confusing for many, making it even harder to implement strong security rules, hence easy to be attacked.
The cyberattack can also take over your credentials via other steps such as utilizing Cloud-based Botnets, hacking multiple-layer authentication, Distributed Denial of Service and attacking near-field communications.
The world of secure banking
Deliberately entering the software, using malicious codes, data, and technology-dependent features, to retrieve personal information comes under cyberattack. Some unique and constant approaches are required to protect current applications and banking software. A security audit is a must-have before implementing any new systems in the BFSI sector. The software contains extremely valuable information, an audit can be the necessary test run for approving a desirable setup. It also recommends alternatives to saving money in the process. Firewalls have also gained major traction. Cybersecurity needs the right quality of configuration settings to block any unsafe elements. Many hardware provides attack blocking with the help of firewalls. Malicious activities can be controlled to a huge extent by banks utilizing this approach. Walking hand-in-hand with the same, Anti-virus and anti-malware applications stops unwanted cyberattacks. The software must be updated at all times to stay one step ahead of system infringement.
Multiple-step authentication is widely being introduced in the banking and digital payments sector. It’s one of the most critical breakthroughs preventing many attackers from reaching secure networks. A one-time password to approve payments is sent to the customer’s registered mobile number. A critical approach to provide an instant infringement block. Another version to assure instant protection is the biometrics system. Using biometrics increases security level by twofold than OTP. It may involve fingerprints, thumbprints, facial recognition, or retina recognition. Each individual has a unique set of fingerprints and a unique identity, making this process owner-specific. Although some hackers have previously cracked this level of security too, the chances are very low. Many platforms are resorting to the option of automatic logout to reduce the chances of fraud. The customer has a choice to stay logged in if they like, however, this increases the risk of attack. It is ideal to have all the accounts logged out after a few minutes of inactivity. The key step to protecting a customer is awareness. Without proper knowledge and learned experiences regarding the digital banking processes, it’s easy to become a victim of cyber-attack and high fear of losing life savings and investments. Banks need to look out for multiple layer security walls. There’s a need for proper supervision and regular security checks. Digital banking can only be fruitful when all the necessary threats are tackled robustly.