In an annual report by Boston Consulting Group, organizations in the financial services sector were rated 300 times more likely to be targeted by cybercriminals. The industry holds a wealth of sensitive personal and financial data, so it should come as no surprise that it faces the highest risk of having that information compromised.
While the introduction of compliance regulations is helping to improve digital defenses and protect customer data, the number of breaches continues to rise. It’s ultimately the responsibility of banks and financial institutions to identify and address any remaining vulnerabilities in their security systems to help mitigate cash flow risks for businesses.
To aid in this effort, we’ve put together a list of the most common cybersecurity weaknesses in the finance sector. Here’s what you should look out for.
Human Error
An issue that prevails across all industries, human error results from internal staff inadvertently creating a vulnerability in the company’s systems. It’s estimated that over a third of attacks involve employees falling victim to phishing emails. Another problem is the use of poorly configured or outdated servers and software.
The solution begins with taking cybersecurity concerns beyond the IT department. If an employee has any level of access to the company’s network, they need to be trained and educated on relevant cybersecurity best practices. It’s also wise to utilize anti-phishing software and email filters that prevent known threats from reaching inboxes.
Technology Gaps
Banking and finance applications are among the most vulnerable web services on the internet. Aside from causing mistrust among consumers, these systems can also be a weaker link in the overall network architecture, which itself can be threatened by outdated programs.
It is therefore crucial that organizations stay ahead and perform due diligence before implementing new solutions.
Insufficient Talent
The immense complexity of cybersecurity can make finding the talent required to maintain it challenging. It’s an industry crisis that is estimated to leave 3.5 million positions unfilled within the next year.
To avoid falling behind, financial organizations should explore automation solutions and outsourcing. This can include the use of AI and machine learning tools, as well as hiring contractors to configure and test security systems.
Supply Chain Risk
To offset the cost of compliance, organizations are becoming increasingly reliant on third-party vendors like cloud service providers. As data is shared across the two entities, any breach on one side can affect the other, regardless of how sophisticated the latter’s cybersecurity is.
This is why it’s important to consider the potential risks of bringing a new partner onboard and giving them access to internal systems. Find out what information will be shared, where it’s stored and how it’s protected.
Conclusion
A final consideration is the customer side, which can pose a weakness when users’ personal devices provide an easy way in for hackers. Key solutions include multi-factor authentication and compliance with regulations such as PSD2. With these vulnerabilities mitigated, financial organizations can enjoy a far lower level of cybersecurity risk.
Infographic created by Donnelley Financial Solutions, an M&A software company