Cyber Security is significant for every profit and non-profit making financial institutions. Banks carry vital information about their clients, and the attackers very well know this fact. So, it becomes imperative for banks and financial institution to have robust Cyber Security in place.
Earlier it was physical thefts; then, it frauds appeared through computers, and today it is not only cyber frauds but also direct hacks into servers to get hold of personally identifiable information (PII) of customers.
As people and companies across the world perform most of their banking or financial transactions through diverse online channels, the risk of a data breach is increasing continuously. This scenario is why there is a more substantial prominence to inspect the consequence of information protection and secure transaction processes, which makes it important for financial institutions to have Cyber Security.
The reasons behind the importance of Cyber Security in banks
The key idea behind Cyber Security measures for banks is to safeguard customer assets and their transactions. As both B2C customers and organizations go cashless, financial activities are done via physical credit scanners and online checkout pages. In both scenarios, PII can be readdressed to other settings and utilized for malicious actions.
Not only does this affect B2B clients and customers, it even considerably hurts the bank while they attempt to pull through the data. When the details are taken hostage, the bank or a financial institute requires paying out a significant amount to release the data and information. In turn, they lose the faith of their customers, other financial institutions, and related stakeholders.
Below are a few points that illustrate why Cyber Security is essential in the banking sector.
Breaches damage banks' standing in the financial market
Data breaches are severe issues for banks, as it results in losing the public trust, and in customer insecurity. It occurs due to feeble Cyber Security tactics, and it is not easy to recover. It is the accountability of the bank to converse with their customers directly in terms of Cyber Security measures. These measures must put off and shield their customer’s personal as well as private information. To gain the reliance of consumers, it is significant for a bank to have a robust Cyber Security plan.
Banks can face consequences and penalties for FDIC non-compliance
Penalties for non-compliance can be unexpected for banks, not only monetarily but also in profoundly increased failure to notice. Having a compliance benchmark drives banks to focus on Cyber Security measures. When a bank remains compliant, it makes sure that it is meeting a security agreement and safeguarding the customer information.
Consumers can lose money and time in case of data breaches
When a bank or financial institute leads to the data breach, consumers lose money and time. A bank may revive the unfairly spent money wholly or partly; however, it does not work well in all the scenarios. The actions that happen due to the breach are time consuming, leading to stress for customers. They may require cancelling the bank cards, constantly verifying financial statements, and keep an eye for technical hitches in case of any data breach scenarios.
Consumer data is perceptive
It is tricky for consumers to manage data breaches when they become aware that their data and information is in the incorrect hands. In addition to cancelling the related bank cards and keeping up with the frauds, the customer is always worried as the personal details can be utilized against an individual. Once a consumer’s private information is stolen, it soars scarily and can get out of control. So Cyber Security is more significant to banks and financial institutions as they carry private data of so many consumers who trust them.
The risks allied with banking on the web and mobile
The other examples of probable issues with Cyber Security in banking on the internet and mobile include:
Risks through mobile apps
More individuals use their bank accounts through mobile applications. Many of these individuals tend to have low or no security, and this makes the impending prospect of an attack much bigger. Hence, safe banking software solutions are necessary to avert malicious activities.
Breaches at 3rd party organizations
As banks have advanced their Cyber Security, hackers now try shared banking systems and 3rd party networks to execute frauds. If these are not as safeguarded as the bank, the hackers can get access effortlessly.
Boost in risks due to cryptocurrency hacks
In addition to the typical or conventional frauds, hacks have been boosted in the maturing space of cryptocurrency. Since the industry is not entirely sure how to operate Cyber Security software for banking in this evolving market, the capabilities of attackers to do frauds has increased. They try to grab massive amounts of this currency, which has low awareness levels and may it swiftly jump in value.
Defend cyber threats to the banking industry with highly secured software
When you explore the current state of security online, you must consider enrichment or the entire alternative of your existing defense applications. Here is some important stuff to look at in the scope of banking software development:
- Having Security Audits - A regular audit is essential before any new Cyber Security software is enabled. The review discloses the strength and weak spots of the active setup. Furthermore, it offers suggestions that can assist in saving money while also allowing precise investments.
- Enabling Firewalls - A Cyber Security banking setup does not only comprise applications. It also needs the precise hardware to obstruct attacks. With a reorganized firewall, banks can block unethical activities ahead of reaching other components of the network.
- Use of Anti-malware Applications - While a firewall update boosts protection, it won’t prevent attacks unless anti-malware applications are upgraded. An old software setup might not contain the newest rules and virus signatures. In turn, it can fail to spot a potentially terrible attack on the systems.
- Multi-factor Authentication (MFA) - This process is crucial to safeguard clients who use mobile or web applications for banking transactions. Using MFA prevents attackers from reaching the system network as it has diverse levels of protection.
- Biometrics - It enables protection through retina scans, thumbprints, and facial recognition to substantiate a user’s distinctiveness.
- Automatic Logout - Many sites and apps enable a user to remain logged in if they allocate it. Thus, they can use their information at any time without using login credentials. However, this also allows attackers to attain your vital records without difficulty. Automatic logout avoids this by concluding a user’s access subsequent to a few minutes of idleness.
- Awareness and Education - All of the above measures can boost Cyber Security in the banking business. However, they can’t assist if customers persist in accessing their information from undefended locations or unacceptably holding their login credentials. This is why awareness and education are essential. When banks inform their customers of consequences connected to these several vulnerabilities, it may move them to alter their day to day practices to safeguard them from attacks.
About the Author:
Mrudul Shah is a CTO of Technostacks Infotech which is a mobile app development company in India & USA. He is helping his entire development team and global clients to access new technologies, interests in learning and sharing IT technology news trends.