Securing Digital Banking: Cybersecurity Measures for Financial Institutions in 2023

With cyberattacks on the rise and companies paying a hefty price, the financial services sector faces a digital dilemma. The average cost of a data breach for a U.S. company in 2022 soared to $9.44 million, and the trend continues upward. As the industry becomes increasingly digitized and electronic transactions surge, the risk of cyber-based perils looms large.

In the year 2023, there are ten cybersecurity hazards poised to wreak havoc. However, financial services companies can safeguard themselves by adopting proactive cybersecurity strategies tailored to their needs. By taking the right steps, they can shield their operations and finances from the stormy seas of the digital world.

In this blog, we will discover different types of cyber-attacks and also we will cover which strategies banks should use to prevent them.

Need for Cyber Security in the Digitization of Banking

In today's cybercrime landscape, both customers and banks bear the brunt of the attacks. The repercussions extend beyond mere inconvenience, especially when it comes to data recovery for financial institutions. Recovering compromised information becomes an expensive ordeal, draining the banks' resources.

To preserve customer privacy and rebuild trust in the face of data breaches, robust cybersecurity measures are imperative. Failing to do so jeopardizes the bank's reputation and brand image. By fortifying digital banking with robust cybersecurity, sensitive data finds a secure haven. Unveiling such data would otherwise pave the way for issues like fraud, resulting in financial losses and immense distress for customers.

10 Risks and cybersecurity strategies for Financial Institutions

As we step into 2023, a new wave of cyber threats emerges, including cryptojacking, AI-based attacks, ransomware, and phishing. However, banks can stay one step ahead by implementing tailored cybersecurity strategies to fortify their defenses. Here are the different types of cyber attacks that banks might face and strategies which they can implement to prevent it:

1. Ransomware Attacks

The rise of ransomware attacks is a growing concern, especially for financial services organizations that often find themselves in the crosshairs of cybercriminals. These attacks have evolved to be more frequent and sophisticated, posing a grave threat. The consequences can be severe, leading to the loss of sensitive data and significant disruptions to operations. Unfortunately, some organizations are left with no choice but to pay hefty ransom amounts to the attackers, amounting to millions of dollars. It's a troubling reality that demands immediate attention and robust defenses.Strategies to Prevent Ransom Attacks:

  • Implement multiple security measures such as detection, intrusion, firewall, and prevention systems.
  • Regular monitoring and analyze security practices
  • Regular update and patch systems and software
  • Encrypt devices and data
  • Create a detailed plan for incident response
  • Implement strong disaster and backup recovery procedures.

2. Cloud security threats

Cloud security controls are essential because cybercriminals are taking advantage of financial services businesses' growing adoption and reliance on cloud services. Threat actors target sensitive data once they have access to these cloud services, which they then manipulate, steal, destroy, or utilize to achieve backdoor access to the internal networks of the organizations.
The most critical flaws are frequently caused by incorrect cloud setups, uncontrolled access to cloud management platforms, and a lack of awareness of cloud architecture. Attacks that follow can reveal private data, stop business activities, and cause large financial losses.

Strategies to Prevent Cloud Attacks:

  • Engage a cloud access security broker (CASB) to add a layer of security between the network of the organization and the cloud service.
  • Work with the CASB to offer visibility into and control over cloud use, as well as to monitor and enforce security regulations.

3. Artificial Intelligence (AI) and Machine Learning (ML) Attacks

Cybercriminals are developing ways to weaponize artificial intelligence (AI) and machine learning for more effective cyberattacks at the same rate as financial services organizations are finding ways to apply these technologies to their businesses. These assaults can be particularly challenging to identify and counter because of their automated and persistent nature.
The following are a few of the AI and machine learning assaults that financial services businesses encounter most frequently:

  • Malicious attacks and data tampering: Threat actors modify input or training data in these kinds of assaults, causing machine learning models to give inaccurate findings or perform in unexpected ways.
  • Stole a model: A machine learning model is stolen by cybercriminals and used for evil.
  • A model inversion: To obtain sensitive data, threat actors reverse-engineer a machine learning model.
  • Attacks on fairness and bias: To produce systematic biases or unfairness in the outcomes of machine learning algorithms, cybercriminals modify data or models.

Strategies to Prevent AI and ML Attacks:

  • Protect models with adversarial training that is aimed at evaluating their resistance to attacks.
  • Retrain and update adversarial response models frequently.
  • Data should be encrypted both during transmission and storage.
  • Use secure protocols to protect data from unauthorized access, such as HTTPS and TLS.

4. Legacy System Attacks

Legacy systems refer to outdated or unsupported systems that are susceptible to security risks. These aging systems lack the necessary defenses against modern and advanced cybersecurity threats, putting organizations at risk of breaches and data loss.

Moreover, continuing to invest in and maintain legacy systems can strain IT resources significantly. A substantial portion of global corporate and government IT spending between 2010 and 2020 was allocated towards operating and sustaining existing IT infrastructure.
By relying on legacy systems, organizations not only expose themselves to potential security vulnerabilities but also face the ongoing burden of allocating significant resources to sustain these outdated technologies. Businesses must assess and upgrade their systems to ensure robust security measures and optimize IT investments for the future.

Strategies to Prevent Legacy System Attacks:

  • Analyze the technological environment of the company.
  • Invest the necessary funds in updating systems.

5. Cryptojacking

The rise of cryptojacking entails unauthorized access by cybercriminals to an organization's computing resources for crypto asset mining purposes. This form of attack is growing in frequency, and its impact on a company's systems can quickly escalate.
The consequences of cryptojacking can be significant, causing considerable performance deterioration, resource consumption, and system slowdowns. Furthermore, the theft of computing power and electricity by criminals can result in inflated utility and technology expenses.
Organizations must be aware of the risks posed by cryptojacking and take proactive measures to detect and prevent such attacks. By doing so, they can mitigate the potential financial and operational consequences associated with the unauthorized utilization of their computing resources.

Strategies to Prevent Cryptojacking:

  • Put strong security measures in place.
  • Check systems frequently for indications of shady activity.

Agile Soft Systems help banks to prevent and tackle threats with effective cyber security strategies

In an era where cyberattacks are on the rise, growing in complexity and severity, maintaining a proactive stance on cybersecurity is paramount for financial services companies.
Engage in a conversation with our team of banking cybersecurity specialists today. We possess the expertise to assist you in constructing a robust cybersecurity strategy tailored to your organization's needs, ensuring a safer and more secure business environment.
Don't wait until it's too late. Take action now to safeguard your company's assets and reputation against the evolving threats of the digital landscape. Contact our banking software solutions providers and fortify your defenses today.