By Neville Louzado, Head of Sales, Hyve Managed Hosting
Cybersecurity continues to be a top priority across industries – as financial institutions are responsible for storing and handling sensitive data from millions of users, security is of paramount importance. However, building a highly secured environment is not an easy task. As security risks and challenges continue to rise in complexity, the FinTech sector needs to find new security solutions to protect their customers’ information and secure business continuity.
Early this year, Keeper Security conducted a research that revealed that 70% of financial services organisations reported experiencing a cyber attack in the past 12 months. The spike in cyber attacks that have been occurring since the start of the pandemic has pushed FinTech companies to reconsider and focus on their security strategy. As the FinTech sector continues its journey into digital transformation, companies need to be proactive and stay cyber resilient.
Implementing cybersecurity solutions
Traditional security solutions are no longer sufficient to protect FinTech companies. The severity of cyber attacks is driving the sector to explore new ways to face cyber threats and mitigate risks. But, what are the main cybersecurity solutions FinTech companies can implement in order to achieve cyber resilience?
- Multi-cloud data storage
Relying on a singular public cloud storage system won’t provide the level of protection a FinTech company might require. Therefore, a multi-cloud infrastructure is advisable. A multi-cloud solution meets the security requirements and data storage demands financial institutions present, allowing greater data usage transparency and providing a backup system for vulnerable data.
- Blockchain systems
Blockchain’s secured and decentralised architecture has proven to be of great value for financial institutions. These data flow systems offer advanced security features that make hacking almost impossible. Blockchain systems turn general financial processes into transparent procedures with protected transactions, enabling the FinTech sector to provide a seamless and efficient alternative to banking.
- Data encryption
Encryption has become an essential and very effective financial security solution in FinTech. Data encryption is defined as the process of encoding information into codes that can only be decoded by using the correct decryption key. With hackers getting smarter, the encryption paradigm has evolved over time. There are multiple options and algorithms that offer protection to critical data including Twofish, Rivest-Shamir-Adleman (RSA) or Triple Data Encryption Standard (3DES).
- AI/Machine Learning
Artificial intelligence (AI) and machine learning are driving innovation across industries, including FinTech. Security and fraud detection has become one of the most common and valuable uses among financial institutions. These technologies are able to analyse data in order to examine client risk and behaviours and identify vulnerabilities. AI and machine learning are gaining widespread adoption in the sector. According to an OpenText survey, numerous banks are planning to deploy solutions enabled by AI: 75% of respondents at banks with over $100 billion in assets say they’re currently implementing AI strategies.
- Multi-factor authentication
The yearly cost for online identity fraud is estimated to be over $12 billion dollars, hence why financial institutions are directing their investments towards authentication solutions. Multi-factor authentication is now an essential part of banking, acting as an extra layer of security, requesting users to provide a certain level of evidence of their identity before they are granted access. However, this is not always 100% secured as hackers might be able to clone and steal identities. FinTech companies need to introduce new methods like adaptive authentication or deep data insights as new solutions to shield their users’ identity and personal information.
Building a cyber secure future for the FinTech sector
With the FinTech sector being a main target for cyber crime, traditional security solutions are no longer sufficient. High levels of cyber threats require the highest possible level of preparedness and security to mitigate risk. Therefore, having an outdated and unsophisticated approach to security is no longer an option. Financial institutions need to increase protection by incrementing their investment in cybersecurity and embracing the deployment of technologies such as artificial intelligence, machine learning or cloud computing. This will allow them to have a robust strategy in place that meets the company’s security requirements in order to protect the privacy of its customers.
The growing concern for cybersecurity in the FinTech sector is clearly palpable. The global investment of FinTech companies in cybersecurity quadrupled in 2020, revealing how companies are putting their efforts towards improving their security in order to be prepared and protected in the event of a cyber attack. Despite the fact that cyber crime is expected to continue increasing, financial institutions seem to be taking the right actions to move towards a cyber resilient future. With trust and security being crucial for financial institutions, building a safe cyberspace must be a key priority, which is only possible with the right approach and security measures in place.
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