Cybersecurity in Banking: Main Threats and Challenges in 2024

The banking industry, like any other, has now been progressively moving into the technological era. The days of physically going to your neighborhood bank to cash or deposit checks are long gone. Hence data security in banking industry is an essential topic today since almost any transaction can be completed online via the bank’s application or website.

With the ongoing shift into the world of technologies, there is one more aspect to keeping track of cybersecurity. Today, we’ll look at bank cybersecurity, the most serious bank threats that financial institutions deal with today, and how banking firms of all sizes can take necessary precautions to avoid them.

What is Cybersecurity in Banking Sector?

The “cybersecurity” system, guidelines, and techniques are designed to protect against threats, potential harm, computer viruses, malware, hacking, information theft, and unauthorized access to networks, computers, applications, and documentation.

The main objective and importance of cybersecurity in banking are to protect the user’s assets. Additional activities or money transfers are moving online as more people abandon cash. Person process transactions utilizing digital methods of payment, such as bank cards and online applications, which must be secure.

The Importance of Being Aware of Cybersecurity Trends

Cybersecurity is not just important for IT organizations; it is essential for all companies. However, today we are talking about cyber security and banking, as well as the importance of being protected. On a daily basis, banks process billions of money transfers. As a result, it is critical to implement bank data security and control measures to protect their data from cyberattacks. Here are some of the reasons why they have security issues in banking industry and how cybersecurity may help.

1. Customer detriment. When a customer suffers a loss due to credit card theft, it is usually possible to recover it from the bank. However, it takes time to recover the finances in cases such as data violations, which is very concerning for customers. Every bank must implement cybersecurity methods to protect their customers’ data to keep their data safe.
2. The bank’s reputation may suffer. Data infringement is a critical issue for banks because it results in the loss of user data. Customers will lose trust in a bank if their personal information is compromised. Data breaches are typically the result of inadequate cybersecurity measures.
3. Digital era. Banks must advance their customer-facing banking activities, as in today’s world, hackers can quickly gain access to financial applications if good cyber security measures are not implemented.

Cybersecurity Challenges Banks Face

It can be difficult to implement prevention methods for cybersecurity banking. Among the major challenges that banks must overcome are:

1. A cybersecurity expertise shortfall in which the percentage of accurately qualified professionals far outnumbers the demand.
2. Poorly informed staff members who have either not received considerable awareness about the importance of cybersecurity in banking sector during the training. Or their education and knowledge is archaic and does not account for new cyber security threats to financial institutions.
3. Limited budget for dealing with cybersecurity threats.
4. Employees who use weak credentials make it easy for cybercriminals.
5. Those looking to exploit mobile banking devices and apps are targeting them.

The Top Cybersecurity Threats in 2024 for Banks

Listed below are the top cyber threats to financial sector that are expected to keep wreaking havoc on financial organizations and banks in 2024.

#1 Ransomware

Ransomware has become a complete nightmare for businesses worldwide for the last several years and shows no signs of abating anytime in the foreseeable future. This is a cybercrime technique in which documents are encrypted, and clients are locked out, with the fraudsters demanding money to re-enter the system.

Companies hit by ransomware cyber attack on banks may find their services paralyzed for prolonged periods, especially if they lack backups. Paying a ransom to these criminals does not ensure that your system access will be restored.

#2 Unencrypted Data

It is one of the most common of all banking security threats faced by financial institutions, in which data is left unencrypted and computer hackers use the data immediately, causing serious problems for the banks. All data stored on PCs in banking institutions or digitally should be entirely encrypted. It will ensure that, whether or not the data is stolen, hackers will be unable to use it.

#3 Common Cloud-Based Cyber Attacks

Since more statistics and crucial information are kept in the cloud, cybercriminals have taken advantage of this, and as a consequence, cloud-based threats are now one of the most prevalent threats of cybersecurity in banking industry. Banks should ensure that their cloud infrastructure is safely arranged to prevent harmful infringements.

#4 Social Engineering

Social engineering is one of the most serious threats to finance and banking. People are frequently the weakest component of the security chain, as they can be duped into disclosing sensitive information and credentials. This can affect both employees and customers of a bank.

Social engineering can take many forms, including phishing and whaling attacks and mailing false invoices that appear to have been sent from a reliable source. Keeping your employees updated on social engineering methods and how such attacks emerge is critical.

#5 Supply Chain Attacks

Cybercriminals are increasingly targeting software companies and delivering malicious files to users and other supply network members in the form of services or updates that seem credible on the surface. These banks cyber attacks compromise the supply chain, allowing cyberattackers to access the networks of the vendor’s clients.

Examples of Cybersecurity Attacks in Banks

Over the last few years, banks have had numerous data breaches. Here are a few examples of cyber attacks on banks:

• In 2020, hackers launched a ransomware attack on Flagstar Bank in the United States, posting personal information about the bank’s clients to steal money from the bank.
• After a prolonged DDoS attack on a network provider, the New Zealand Stock Exchange was forced to shut down business functions in 2020.
• In 2021, the online trading platform Robinhood faced a security breach in which a cybercriminal gained access to the personal details of 7 million users.
• In 2021, the Pichincha Bank was targeted by a cyber attack on bank, causing customers’ access to banking services to be disrupted.

How to Make Banking Institutions Cyber Secure?

After all, banking institutions can also take steps to secure their systems from common threats of data security in financial services. This includes the following:

• Overcoming the labor shortage by collaborating with other companies and security associates who provide managed services
• Incorporating ongoing training in banking cybersecurity awareness or evaluating current initiatives to make sure they are current and relevant in the threat environment
• Investing in detection and protection tools that will allow you to be alert and avoid being hacked
• Implementing customer education programs to make sure that clients do not reveal sensitive information to cybercriminals

Wrapping Up

Don’t give cybercriminals the upper hand. DashDevs can assist you in preventing security threats! Our effective approaches could be exactly what your company needs to stay on top of cybersecurity. Please contact us here if you want to learn more or get started!

DashDevs works with financial services of all types to successfully resolve both internal and external security risks, preventing sensitive client information from being compromised.

FAQ

What is the Most Common Cyber Threat?

Human error is the most significant risk to cybersecurity. People are ultimately responsible for putting data and systems at risk, whether they have been duped into providing sensitive information, have not properly secured their passcodes, have used bad login information, have clicked on suspicious sites, or have decided to open dubious links or attachments.

How does Banking Cybersecurity Work?

The goal of banking cybersecurity is to protect consumer assets. The financial institution must also take measures to keep the hackers from succeeding. As more people work, the quantity of financial-related acts increases.

What are the Best Ways to Improve Security?

A variety of strategic measures can be implemented to improve cyber security banking. In this sector, common types of security include:

• Investing in high-quality financial cybersecurity solutions.
• Taking a ‘zero trust’ focus.
• Making certain that third-party partners do not pose a potential security risk.
• Employee cybersecurity awareness training.
• Having effective mobile security systems.
• In the case of a breach, having quick response times is essential.