The Role of Cybersecurity in the Era of Digital Banking

Banking CIO Outlook | Friday, January 15, 2021

FREMONT, CA: The banking sector has been subject to attack for hundreds of years now. First, it was physical robberies where the money was targeted, and now there is computer fraud. However, the damage caused is on a much higher side today, as attackers try to access customers’ personally identifiable information. As a result, staying up to date with cybersecurity is of utmost importance in the banking sector. Organizations are now increasingly dependent on online transactions. Hence, the risk of a data breach is on the rise every day.

The primary aim of cybersecurity in the banking sector is to protect the customers’ assets. As more people go cashless, activities are done through online checkout pages and physical credit scanners. Either way, in the event of a cyber attack, customers’ personally identifiable information can be redirected to other locations and used for malicious activities.

This not only affects the customer but also has vast implications for the bank. Any attempt to recover the data can do a lot of damage to the bank. If the data is taken hostage, banks will need to shell out large sums of money to recover from the situation, while losing the trust of their customers and other institutions in the process.

However, that is not all the damage that can be caused if adequate cybersecurity measures are not implemented. Customers will need to cancel all their cards and start new accounts, possibly at another bank. Although the FDIC protects the customers’ funds, it wont stop the criminals from using the customers’ personally identifiable information.

The Risk from Mobile Apps

The number of individuals accessing their bank accounts on their mobile devices is increasing. Majority of these individuals have minimal or no security, increasing the potential for a cyber attack. Hence, banking software solutions are required at the endpoint to prevent malicious activity.

Breaches at Third-Party Organizations

As bankers update their cybersecurity policies, hackers are now looking at third party networks and shred banking networks to gain access. If there is a lack of adequate protection, they become very vulnerable to cyber attacks.

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