To some, cybersecurity sounds like something that only the military or top-secret organizations would handle. In reality, cybersecurity affects many businesses and institutions of all sizes around the globe.
The banking and financial sector should be extra concerned about the threats of cybersecurity. As more and more of the banking world goes digital, this opens up the online door for potential attacks and security risks. Cybersecurity should be a top priority for banks if it isn’t so already.
Having solid and effective cybersecurity programs is vital and incredibly important.
Today, we’re going to run over the basics of cybersecurity and banks. We’ll answer some important questions while talking about how your bank can secure your network and prevent cyberattacks.
Cybersecurity and Banking
As a bank or financial institution, you know that one of the most important aspects of client relations is trust. Holding, protecting, taking care of money, and helping people make financial decisions is probably a large part of your mission statement and message.
Banks have become a larger target for cybersecurity attacks, attacks that are becoming increasingly more prevalent and sophisticated.
The world is moving to a cashless society, something that has been in the works but sped up by the COVID pandemic. Suddenly, banks have become more digital faster than they originally thought.
Banks have been protecting money from thieves since the days of the Old West, but now there’s a greater emphasis on protecting everyday transactions. No rough and tough cowboys with 10-gallon hats are kicking down doors. It’s all about preventing unauthorized access to one’s financials.
People aren’t just using their bank cards to withdraw cash or make a deposit. They’re relying on your bank to buy gas, clear off their Amazon wishlist, or go to the movies. That presents more and more opportunities for consumer data to be put at risk.
If your bank suffers a data breach, personal data may have been uncovered but you also lost something that can’t be bought back: consumer trust. Customers are looking for an institution they can trust to keep their money and information safe.
While you may be able to put back the pieces after a breach and recover any data, building back customer trust will take much longer.
For many banks, that’s just something you can’t afford.
What methods do hackers use?
When it comes to cybersecurity, what should you be looking out for? There are a number of attacks ranging from everyday, basic attacks to more sophisticated ones.
Without a doubt, phishing is one of the most common cyber attacks that affect both clients and staff members. Even though it’s common and relatively basic, it shows that cyber attacks don’t always come from hooded individuals behind 900 screens.
These phishing attacks usually come from emails, phone calls, or other forms of communication.
There are a few types of phishing attacks to be aware of, the first of which is spear phishing. This is when a hacker goes after a particular individual of an organization in hopes of implementing malware or trying to discover confidential data.
Whale phishing, on the other hand, is when hackers go after a high-level employee such as the CEO or CFO.
There are several various web attacks that hackers use. Cross-site scripting, also known as XSS, is where an attacker will implement malicious scripts into trustworthy websites. The attack occurs when the attacker uses a web application to transmit malicious code to a separate user.
The end-user doesn’t know that the script is malicious and will execute it, infecting their browser. Since the script appears to come from a trustworthy site, the code can now access everything from cookies to sensitive data.
An SQL injection, or SQLI, is another attack that works on the backend. This code is designed to manipulate databases and extract information that is not meant for the public eye. An SQLI is often one of the most devastating cyber-attacks a bank can face, as databases can be altered or erased and customer data can be released.
These attacks can either go after an SQL database or a website itself.
Another high-profile attack, DDoS attacks are aimed at shutting down a service or network. Users won’t be able to access the network until service is restored. DDoS attacks often go after high-profile companies or services, like when Amazon Web Services was targeted in February 2020 or in 2012 when six high-profile US banks were attacked.
DDoS attacks are when large amounts of traffic cause a service or network crash, leading to downtime. And downtime can cost your bank significantly. While no personal information or data is lost or stolen, downtime can be devastating to any institution with daily customers.
Fans of sci-fi movies will no doubt recognize the storyline where a computer program or AI gets “too powerful for its own good” and tries to take over the world. The idea of that becoming reality is pretty terrifying.
But AI-led, or AI-powered, cyberattacks are a real threat that can cripple your bank or financial institution. Machine learning is being used all over the tech world and has been used with malicious intent. Machine learning software is software that trains a computer to perform a task independently.
Much like humans, they keep practicing and practicing this task until they’ve learned how to do it themselves. AI can go after private data, passwords, and DDoS attacks.
What is the average recovery time of a cybersecurity attack?
If your bank or financial institution suffers an attack, when can you expect to make a recovery?
The primary answer to this is “it depends”. It depends on how well-prepared your financial institution was prepared ahead of time, what you had budgeted for your security, awareness programs, and more. To judge your preparedness, running an IT security audit is always helpful.
According to a study by Certify, highly secure companies took an average of seven days to recover from an attack. Those with low security took more than 90 days to fully recover from such an attack.
After all, the average cost for each lost or stolen record is about $150. The average cost of a cyberattack on a bank or financial institution is almost $20 million, something that many businesses just can’t recover from. Considering that roughly one in four financial institutions have suffered a damaging cyberattack, is your institution ready?
The Pandemic and Cyberattacks
Since the start of the pandemic, more people are working from home than ever. And more people plan on working from home on a permanent or semi-permanent level this year. Many don’t have proper home security, opening up themselves and their business for potential attacks.
Since the pandemic began, banks and financial institutions have seen an increase in cyberattacks as businesses struggle to create safe, digital channels for those working from home. While a bank’s network may be secured in the office, an employee’s home WIFI may not offer the same level of security.
It also makes it much more difficult for security teams to detect cyberattacks. In some cases, it may be weeks before a breach is detected and by then, it’s too late.
Looking forward, many banks should think about their current security policies and how ‘future-proof’ they are.
Are you able to handle more employees working remotely? What if you move your services to a public cloud? Do you have the proper cloud security in place? Although these trends may play themselves out over the next coming months or years, it’s beneficial for your bank to start thinking about that right away.
What can banks do to protect from cyberattacks?
The best thing banks can do to protect from cyberattacks is to take proactive steps to stop an attack before it happens. Spending time, effort, and money to protect your most valuable assets is worth it, even if you’ve never experienced a cyberattack before.
Create a Risk and Security Plan
Banks too often rely on out-of-date IT infrastructure or believing that a cyber attack isn’t likely to happen. Instead of relying on old technology and reactionary measures, banks need to be planning out their risk assessment plans and investing in proper cybersecurity methods.
- One of the first steps is to identify vulnerabilities and threats. These can be personnel, organizational issues, or network weaknesses. One of the best ways to measure these weaknesses is through penetration testing to patch those areas before they become real problems.
- Next, you can classify your assets in order of sensitivity and value. These assets are usually data points containing confidential or internal use-only information that shouldn’t be available to the public.
- Lastly, you should always be analyzing risk. Just because you’ve implemented safeguards and security doesn’t mean that they haven’t become outdated or vulnerable. Monitoring risk should be a constant task to keep your information secure.
You should also regularly be educating employees about the potential threats and dangers of a cybersecurity attack. This involves a few items that are quite manageable.
- Multi-factor authentication, or MFA, is when a user must provide two or more login credentials to access an account. That can be a mix of PINs, fingerprints, or passwords. MFA is annoying, but it helps prevent a breach if one login is compromised.
- Security training should be regular for employees to keep them updated on the latest cyberattack tendencies and trends. With proper training, employees can actively and rapidly identify vulnerabilities and security issues.
Some banks or businesses purchase cyber insurance as well. Insurance makes sure your business is financially protected in the event of a breach and can help cover legal expenses as well. Insurance also pays for damaged systems, helps restore compromised data, and alerts customers in the event of a breach.
Create a Response Plan
You may have everything set in place and a breach still occurs. If that happens, you also should have a plan in place.
This means having a set list of actions that you can immediately refer to if you notice a breach. A 2020 study by PWC showed that only 30% of institutions have such a plan in place. Having a plan ready can help reduce the financial and reputational damage incurred from a breach.
Your plan should involve the following steps:
- An IT expert suspects or identifies the problem.
- Work to contain the breach
- Assess the risk and damages behind the breach
- Review the incident
- Patch or revise security to prevent future breaches
- Train employees or team on additional security measures if necessary
While this is a simplified version of a plan, these guidelines are crucial when having a response plan.
How much do banks spend on cybersecurity?
While there is no solid number on how much banks should be spending on cybersecurity, some surveys suggest around $3,000 should be spent per employee on cybersecurity. A study from Deloitte suggests that around 10% of your IT budget should be spent on cybersecurity alone.
There are certainly budget and financial actions you can take, but many prevention methods are quite simple and effective.
What Atiba Can do To Help Your Bank
As cybersecurity experts, we’ve worked with plenty of banks and financial institutions around the country to help them protect valuable data. We can help your bank or financial institution train employees, run security assessments, implement a response plan, and contain any breaches that may occur.
Working as a third-party service, we can provide a clean, fresh look at your security and advise on the next steps. We’ll work with your bank to help implement a customized plan that adheres to your needs and secures your bank.
If you want to learn more about how we can help your bank or financial institution, reach out today for your project quote. We look forward to helping you.