By Dominik Birgelen, CEO of oneclick AG
The finance industry is a paranoid one when it comes to security concerns. Banks and financial institutions are system integrators in their own sense with so many proprietary vendors all having their own compliance issues. As a result, there are often too many security solutions in place making it difficult for backend employees to navigate their own systems and deliver efficient customer service.
In particular, the financial sector has expressed high concern over identity and authentication issues. In today’s digital age, every user, whether it be an employee or customer has a unique digital identity based on their online footprint. This includes very personal data such as social media activity, healthcare and financial records, demographics, login credentials, web history, and more. Like any identification, digital identities must be protected to prevent risks of identity theft and/or fraud.
Where the influx of data available online has increased over recent years, thanks to digital transformation efforts, protecting identity and providing flawless authentication has become a challenge. As technology continues to advance, securing sensitive data must be a top priority for banks and financial institutions.
Remaining Vigilant of Password Vulnerability
It is advised that financial companies look first to the security of their employees’ systems and their authentication processes after the UK government reported that 39% of businesses identified a cyber attack in the last 12 months. What’s more, over 80% of hacking-related breaches are tied to misplaced or stolen credentials.
With sensitive customer financial data on the line, the cyber risks are relentless. Changing economic and political environments usually lead to even higher threats, for example, since Russia invaded Ukraine, a sharp increase in malicious Russian cyber activity began in January. Multiple Russian-based IP addresses targeted UK-based financial institutions, scanning for weaknesses.
Enforcing regular password resets amongst employees may seem like the ideal solution, but this would only serve as a temporary fix as users typically repeat passwords across other accounts. Where password reuse has become common malpractice, stronger authentication controls can help banks and other financial companies keep customers protected and sensitive data secure.
Exploring Cloud-Based Security Opportunities
Where the evolution of technology has incurred many security issues, it also helps to solve many of the financial sector’s challenges and protect various institutions through advancements in the digital landscape. The evolution of cloud computing, which was traditionally valued for its cost saving capabilities, is now invested in for its cyber security abilities. Cloud-based technologies allow banks to implement critical security measures that prove extremely difficult to penetrate including shielded logins, disconnecting the end user environment and Zero Trust Architecture.
Cloud-based solutions can help not only support the enormous amounts of data within a financial institution but also add an additional layer of security that keeps customer and company data confidential and sensitive information away from malicious intent. Many cloud-based solutions include features such as shielded logins. Using an authentication service whereby the user’s logins are transported via the browser as a client, all other authentication processes are performed by backend systems. Logins can be dynamically generated, and unique passwords and tokens are also encouraged that are not stored by the service provider so that the login information to applications remains hidden for all other users.
Zero Trust Architecture (ZTA)
The growing adoption of the cloud has resulted in the need to secure financial portals like online banking and apps at all times. Outdated security mechanisms are no longer considered appropriate in the age of the cloud. Therefore, financial institutions must look to adopt ZTA, in which data and identity serve as new basics to be protected. Banks must dissolve inactive identities that can enhance system vulnerabilities and expose critical resources to threats. Through a ZTA approach, no actor who attempts to access resources or services within the system is trusted from the outset. This means every access, whether from outside or inside, is individually authenticated and as soon as a change in risk is detected, access is interrupted.
Striking a Balance in 2022 and Beyond
Many banks and financial institutions have struggled to maintain a manageable yet secure equilibrium between identity security and IT admins. Overloading a company with too many security solutions actually disrupts work efficiency and in turn damages the success of the company. It, therefore, becomes important to strike a balance between identity security and ease of use for employees and customers alike.
Through the implementation of a fully scalable cloud-based solution, that includes shielded logins, ZTA and many more smart cyber security processes, employees can remain efficient while not having to concern themselves with the risk of a security breach on their behalf.
Global Banking & Finance Review
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