European tech startups are emerging with strategic rethinking to tackle cyberterrorism—the most critical and immediate concern for most banks today.
FREMONT, CA: Banks all around the world are reimagining their business processes to put customer demands at the centre. Digital transformations, combined with an always-connected, tech-savvy customer and an emerging hacker industry, is creating heightened security risks that banks must address immediately. Europe also encircles banking revolution, and this is set to be pivotal with seismic developments ranging from the onset of GDPR, the implementation of Payment Service Directive (PSD) and the ongoing evolution of security-based solutions. In many ways, Europe represents the perfect storm in terms of the challenges and opportunities that modern banking portends. Everything from KYC and open banking to security authentication are bringing about the most significant changes to the financial operation in decades. And startups are in the driving seat by offering advanced security solutions. Here are the ones worth considering for banks to gain an improved security posture.
• Identity Proofing
The way some banks onboard and verify the identities of their customers online is often inconvenient and insecure. This results in lowered customer satisfaction and loyalty and security breaches leading to compensation payouts and legal costs. Onboarding and verification are increasingly being set by more tech-savvy players outside the banking industry. If banks want to keep customers loyal, they have to start innovating this area with identity proofing solutions. The trick is to streamline verification for customers without compromising accuracy with the help of emerging technologies including biometrics, optical character recognition, blockchain, cryptography, and many others. This will help successfully digitize customer identification that could help them secure a valued place, relevance in the modernized economy.
10x Banking provides a suite of enterprise-grade technologies, including compliance reporting and security, which includes identity verification services. Its technology enables a single point entry for financial institutions to engage with customers through a secure connection. The startup is in the UK and has raised $64.81 million in total funding. Onfido, the London based identity verification solution provider is on its mission to help banks build trust in the digital environment. It leverages artificial intelligence to verify people's identities digitally.
• Data Encryption
It must come as no surprise that the banking industry is among the most regulated among all sectors. Aside from personally identifiable information, the banking industry also regularly handles data that includes income, credit score, collection history, and non-public personal information. The first step that banks and financial institutions can take is to deploy encryption based on industry-tested and accepted algorithms along with strong key lengths. There are many levels within an organization that encryption can be used. It can be implemented at the database level and application level. It is easier to use and is within reach of even the most modest budgets.
Boxcryptor is a European company providing cybersecurity solution for banks with its end-to-end encryption software optimized for cloud storage. The mission of the company is to make elaborate security solutions easy to use for banks by keeping control of their data. Comcrypto is another specialized security solution provider in the encryption of enterprise communication. It works to make optimal security user-friendly and cost-effective.
• Biometric Authentication
Biometric authentication is nothing new for the banking industry. Fingerprint scanners are a typical example of a commonly accepted form of non-password authentication. But with cyber-terrorism on rising, banks are looking for better ways of managing authentication systems. The challenge is to tackle authenticators and meet compliance standards. Authentication will allow customers to sign on to accounts seamlessly using one authentication method. Now banking customers are even using biometric authentication at ATMs, and some are pioneering new authentication methods. The biometric framework will integrate biometric authenticators such as voice, fingerprints, retina, or iris of the eye or a combination of these identifiers. Identification methods can be achieved on built-in biometric sensors. Billions of banking customers are shifting to digital platforms, and it is becoming more critical than ever for banks to offer a mobile platform for logging into accounts using biometric authentication.
AimBrain is a London based startup that offers biometric as a service to help financial institutions fight fraud. Its function includes verification based on customer's voice, and behavioural authentication like looks and how customers interact with the device, their typing speed or the way one handshake. Biometric authentication startup SmilePass with its game-changing technology is helping financial institutions build trusted customer communities and protect their customers from fraud, social engineering, and theft. SmilePass uses cutting-edge deep-learning and face-matching technology, tokenized verification, and server-based security validation - all incorporated into consumer-friendly applications.
Cybersecurity has been of vital importance in the financial sector. It becomes all more necessary since the very basis of banking lies in nurturing trust and credibility. Banks have to be on their guard more than most business. Given that it has become imperative to have a trusted technology partner to help navigate the murky waters of cybersecurity. Startups in this area are seen willing to work hand in hand with a bank to ensure maximum security across the business. One of the best approaches to heighten security is implementing a modern technology platform that is potent in taking a holistic approach to cybercrime.