Financial Services

Why Cybersecurity is Essential in Financial Services

Against the backdrop of a pandemic, cyberattacks have been on the rise in 2020. The financial services sector has seen particularly frequent attacks. And the threat continues to grow, as cybercriminals grow more sophisticated. Amid all the panic and restructuring, cybercriminals are predictably looking for a big payday. The current need for remote workforces only increases the problem.

In any other case, remote working is great. Workers can spend more time with family or friends. They can work at a more relaxed pace. It’s never been easier to work remotely. Unfortunately, we weren’t prepared for a pandemic forcing us to do so.

Between increasing attacks, remote workers, and insider risks, businesses have a lot of new challenges. And all of these are in addition to making things work during COVID-19. That means it is more crucial than ever to invest in appropriate cybersecurity, especially in industries as sensitive as financial services. Here are just a few reasons why:

1. Complex Supply Chains Offer More Attack Points

Businesses in the financial services sector usually have very complex supply chains. In most cases, the different parts of this chain are interdependent. The more links in the supply chain, the more potential attack points for cybercriminals. This is not exactly new.

Cyberattacks have consistently targeted financial supply chains for over a decade. Typically, these attacks have been directed at managed or cloud service providers. A technical service provider being compromised can severely hurt your financial services business.

2. Hackers Continue to Steal IDs and Credentials

Cybercriminals often steal credentials as well as digital identities. Given the COVID-19 crisis, remote workers offer many more targets than a business would normally. Businesses offering financial services have also been forced to adjust to remote workforces. In many cases, cybercriminals are even more active in this now abundantly rich landscape.

They have been trying to hit financial services and government aid programs being routed through them. One way they have been doing so is by using stolen credentials and identities. Certain malware is specifically designed to target financial institutions to steal customer credentials and identities.

3. Increased Vulnerability to Data Theft and Manipulation

Cybercriminals continue to attack financial services businesses. But sometimes, their motives can be even more sinister than data theft. New age cybercriminals often pick up on a misguided Robin Hood persona. With a socialist understanding based on memes, many are out to “right the world order”.

In other words, erase critical data that could disrupt, and even crash a financial institution. Modern software also comes with new vulnerabilities that cybercriminals could exploit.

Once they have gained access, what they do is anybody’s guess. You could lose your data, servers, or even be targeted by ransomware. That’s not to mention the risk of fraudulent data manipulations. None of these scenarios looks very appealing.

4. A Single Data Breach Can Damage Credibility and Reputation

The problem with not-being a cybercriminal is having to do everything correctly every time. Cybercriminals only have to breach your defences once. On the other hand, your security needs to be on point every time. A single data breach can be disastrous for a financial services firm.

In a volatile market, the fallout from a successful cyberattack is a reduction in stock value. That’s not to mention the damage to your credibility and reputation in the industry. It can often result in a trust deficit between your institution and your customers.

We’ve all seen instances of attempted breaches. The most common and often-successful is phishing. You may get an official-looking email from your provider. It could be asking you to text a security code to an enclosed number. With suitably urgent language, many people fall into the trap. But after you call the Spectrum phone number to ask, you find out no such email ever originated.

Looking closer, you see the email domain and address are minutely different. You have just been scammed. Now think of all your financial services employees who could be targeted in the same way.

This is why it is so important for financial service firms to build strong team or partner with firms offering cyber security consulting services. The alternative is simply too disruptive for a sustainable business.

 

More from tech: These Cybersecurity Threats Are Costing Businesses Money, Yours Might Not Be Safe

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Author: Rosie Harman

Rosie Harman is a Senior Content Strategist, specializing in Technology. She holds a Master’s in Business Administration from The University of Texas at Arlington and has spent the majority of her career working in tech giants in Texas. When she’s not helping the content team, Rosie enjoys adventuring with her two children around her home town.

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