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This blog was written by an independent guest blogger.
Cybersecurity is among the most critical issues facing financial institutions today. Cyberthreats have been on the rise over recent years at the same time digital banking has gained popularity among consumers. Banks that want to meet demand without compromising safety must overcome several key security challenges.
1. Remote work
Since the onset of the COVID-19 pandemic in 2020, remote work is no longer the exception but the rule. While many financial institutions had to move to remote work arrangements out of necessity, employees are staying home out of preference. Surveys from late 2021 indicate that 37% of people want to continue working fully remote even after the pandemic. Another 54% said they want a hybrid arrangement, split between remote work and office hours.
Banks need to consider their employees’ needs and best interests, but remote work does require some extra cybersecurity measures. People working from home, coffee shops or elsewhere lack the protection of an office’s physical cybersecurity defenses.
2. Phishing
Phishing attacks have been a favorite tool for cybercriminals recently. Mobile phishing attacks surged by a shocking 161% from 2020 to 2021. They use disguised emails or domains to trick individuals into downloading malware or giving away personal information, which is known as credential phishing.
Employees and customers are at risk of phishing when it comes to digital banking. Cybercriminals may send emails disguised as official bank correspondence to customers, which can prove effective for stealing financial information. Likewise, employees must be on the lookout for phishing that seeks login credentials to access customer information.
3. Malware and ransomware
Malware and ransomware have been among the most dangerous threats across all industries over the last couple of years. In-depth studies by INTERPOL found that the COVID-19 pandemic sparked a 36% increase in malware and ransomware attacks, a surge second only to that of phishing. These attacks are becoming more common and advanced. During the pandemic, the percentage of cyberattacks using previously unseen tactics has increased from 20%-35%.
Organizations have begun using next-gen cybersecurity tactics to defend against these advanced threats. Behavioral analysis, AI and machine learning are becoming increasingly common cybersecurity tools. Digital banking must also evolve, incorporating cutting-edge technologies to stay ahead of cyber criminals’ innovations.
4. Customer behaviors
Customer behavior can put data at risk just as much as employee behavior can, if not more. Poor cybersecurity practices from digital banking customers can compromise their information in seconds. Everything from reusing passwords to opening suspicious emails can quickly result in losing sensitive financial data. In fact, one of the biggest challenges in digital banking today is implementing cybersecurity at scale, covering millions of phones, tablets and computers.
There are a few ways digital banking organizations can prevent breaches due to customer errors. They can use well-designed mobile apps with a streamlined user experience and built-in security functions. A user might utilize the fingerprint scanner on their phone or another multifactor authentication method to access their account. Sending out regular correspondence on the importance of good security practices is another way to encourage customers to be careful with their banking data.
5. Spoofing
Spoofing is similar to phishing but often more complex. There are a few main types of spoofing attacks, all utilizing some form of impersonation. Domain spoofing consists of creating a fraudulent version of an actual domain meant to trick users into giving away login credentials and personal information. This tactic bets on the likelihood that people will not look closely if a website appears to be legitimate.
Similarly, a hacker could “spoof” a financial institution’s phone number to call or text customers. The bank’s correct caller ID will show up on the customer’s phone, making it difficult for customers to tell if it is a legitimate message or not. Even if people do not fall for spoofing attacks, digital banking organizations need to keep an eye out for them since they can decrease customer trust.
6. Fraud and identity theft
Fraud and identity theft has skyrocketed over recent years. The Federal Trade Commission received nearly 1.4 million reports of identity theft in 2020, which was approximately a 213% increase from 2019. These attacks are not new to financial institutions, but they are evolving with cybercrime. Now fraud and identity theft can be conducted through other cyberattack channels, and digital tactics may make it more difficult to detect.
Digital banking organizations must implement cybersecurity strategies that actively search for suspicious account activity to fight these attacks on the virtual front. This is one of the surest ways to catch fraud attempts. For example, a user attempting to buy something from an unusual location could indicate their information has been stolen, and a cybercriminal is utilizing it.
Evolving digital banking security
Cyberattacks are becoming more common and sophisticated every year. More consumers are turning to the internet for everything from shopping to paying their bills, so digital banking organizations must take their security to the next level. Protecting customers is no longer as simple as complex passwords. Financial institutions need to remain at the forefront of cybersecurity innovations in today’s digital banking environment. That way, they can stay ahead of cybercrime and stop breaches before they happen.
