Why is Cyber Security in Banking Important?

For any economy, most of the money lies with banks. This makes the banking sector the most vulnerable to cyber-attacks.

42% of the banks have predicted that the majority of their customers will be using mobile banking in the coming three years.

According to Gulshan Rai who is the national cyber security coordinator, approximately 22% of the cyber-attacks that took place in India last year were deployed on the banking sector.

As per the Data Breach Investigation Report, almost half of the bank data security incidents involve compromised web applications. The report states that out of the incidents related to cyber security in banking industry; 48% were related to data security incidents, which occurred during 2015 involved compromised web applications.

How to Ensure Cyber Security in Banking?

Bigger banks are spending about 4% of their total IT budget on cybersecurity.  Smaller banks, cooperatives as well as other smaller financial institutions are still not spending the required amount.

Compared to the bigger Indian banks, the banks in North America as well as Europe are spending about 6-10% of their IT budget. Banks are doing this to combat rising incidents of financial crime that involve cyber attackers.

Kaspersky lab has revealed that some of the largest banks tripled their cyber-defence budgets during last three to four years. This has been done among the surge of attacks on client accounts, information as well as other data.

American banker has stated in one of its articles that U.S. banks and other financial firms are increasing their spending on cybersecurity. This step has been taken since banks are facing bigger threats and more attacks. Some of the largest U.S. banks have already boosted cybersecurity spending up to $1 billion annually. This was initiated following cyber-attacks at Equifax and Anthem.

What can be done to prevent such attacks?

• For minimising the cost of cyber-attacks and to strengthen cyber security in banking, an integrated and intelligent security system is required. This includes protection against cyber-attacks by discovering vulnerabilities before being exploited, detecting unknown threats with advanced analytics.
• It includes responding to cyber-attacks with response planning as well as orchestration. It also includes identifying cyber resiliency and readiness and recovering access to critical data as well as applications.
• Adhere to strict guidelines that help in fending off cyber adversaries but also help to respond swiftly and effectively to cyber breaches.
• It is also important to implement measures that will help in enhancing the cyber security of banking. To enhance the safety of the data of banking customers with the financial institutions and will help in enhancing cyber security.
• Another effective method to prevent cyber-attacks is to train employees against cyber-attacks. With effective cyber security and awareness training, employees learn about various strategies and tactics that are used to deploy cyber-attacks. With security attack simulator and awareness tools like ThreatCop, employees can learn about various cyberattacks. This is done through its four-step cycle of simulated attacks, awareness and assessment.

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Pallavi Dutta

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