The banking industry continues to be a preferred target for cybercriminals, and for good reason. Mainly because banks store highly valuable information, such as credit card and loan details, estates, titles, wills, and personal data. Banks also routinely handle large financial transactions, so a successful cyberattack against a bank can be extremely profitable for cybercriminals.
In order to protect their systems and customers' data, banks need to improve their cybersecurity posture. To do this, they must identify the most common cybersecurity threats to their industry and find ways to defend against those threats.
What Are the Biggest Threats to the Banking Industry's Cybersecurity?
The top cyberthreats plaguing the banking industry today include:
Phishing is a social engineering attack in which cybercriminals pretend to be another person or entity to trick their victims into disclosing login credentials, financial data, or other sensitive information.
In 2021, phishing scams were the most common type of cyberattack — making up 46% of attacks — against the financial services sector. These scams are expected to become even more prevalent as phishing kits become more widely available to anyone via the dark web.
Vulnerability exploitation accounted for 31% of cyberattacks on the financial services sector in 2021. These attacks take advantage of software or hardware security holes to gain access to systems and/or data. Vulnerability exploitation attacks can be devastating because they can give attackers complete control over a system.
Threat actors are attacking banks using ransomware, a type of malware that encrypts a victim's files, making them unusable unless a ransom is paid.
Ransomware attacks against banks and other financial services firms have become increasingly prevalent, with 55% of organizations from this sector falling victim to ransomware in 2021, up from 34% in 2020. Fifty-two percent of financial services organizations ended up paying the ransom in 2021 compared to only 25% in 2020 and 46% worldwide in 2021. Moreover, financial services firms spent an average of $1.59 million on remediation costs in 2021, which is above the global average of $1.4 million.
Web Application Attacks
This type of attack targets vulnerabilities in web applications like banking apps to gain access to sensitive data like customer information.
Web application attacks on the financial services sector rose to 16.1 million incidents in 2021 from 11.7 million incidents in 2020. This increase can be largely attributed to the growth of online banking driven by the COVID-19 pandemic. With more people banking online, more customer information is available for cybercriminals to steal.
Distributed Denial-Of-Service (DDoS) Attacks
DDoS attacks involve flooding a target system with heavy traffic to cause the system to crash, preventing users from accessing the system
In 2021, the banking, financial services, and insurance (BFSI) industry was the most targeted industry by DDoS attacks, accounting for more than a quarter of the total number of DDoS attacks. Such attacks against Banking, financial services and insurance (BFSI) have been steadily growing since the beginning of 2020.
What Steps Can Banks Take to Improve Their Cybersecurity?
Banks can boost their cyber defenses in many ways. For example, they can:
Adopt a Zero Trust Security Model
Traditionally, businesses secure their company network by fortifying its perimeter with firewalls. This perimeter keeps unauthorized parties outside but allows users with proper access credentials inside. This means that everyone with access credentials is assumed to be trustworthy.
In contrast, the zero trust security model does away with this assumption by thoroughly authenticating all users — even top executives and long-time employees — before giving them access to company data and resources. The zero trust model is based around ensuring safeguards for devices, data, networks, applications, and users.
What's more, the zero trust security framework deems breaches inevitable, so banks must implement measures to mitigate the impact of breaches. First, user access must be limited to only what users need to perform their tasks (i.e., role-based access control). IT admins must also monitor each access attempt. By implementing these two measures, banks can prevent users — including threat actors — from moving laterally across their network.
Leverage a Security Information and Event Management (SIEM) Solution
A SIEM solution collects log data from various sources, such as websites, applications, security tools, network devices, and databases. It then uses all of this data to assess activity logs and generates alerts when it spots suspicious activities that may indicate a cyberattack. This can help banks prevent cyberattacks from escalating or even happening in the first place.
Conduct Employee Security Awareness Training
Banks should train their staff on cybersecurity best practices, such as setting strong passwords and not reusing them across different accounts. Employees should also know how to spot and respond to suspicious activities and cyberthreats like phishing emails.
By educating their employees on cybersecurity, banks can reduce the risk of human error that could lead to a data breach.
Consult a Cybersecurity Expert
Some banks may want to seek advice from a cybersecurity expert regarding how to improve their defenses. For instance, we at Charles IT specialize in IT support and services for banks and other financial services firms. With our experience and expertise, we can help your organization identify weaknesses in its systems and develop strategies to mitigate these risks.
We can also help you boost your cyber defenses and meet your compliance requirements, as well as improve operational efficiency and employee productivity. Talk to our experts today!