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The Evolving Cybersecurity Landscape in Fintech: A Sneak Peek into 2024 and Beyond

November 30, 2023

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Cybersecurity in Fintech

815 million records from ICMR’s database were exposed in October 2023. Is fintech ready for the cybercrime landscape in 2024 and beyond?

The FinTech ecosystem deals with massive quantities of personal and business data. Rising globalization and third-party collaborations are multiplying the routes of access to such data. With increased interconnectedness and surging complexities across the digital financial space, protecting sensitive business and customer data has never been more important. This blog discusses how the cybersecurity landscape is expected to shape up for the financial industry in 2024 and beyond.

FinTech is a Hot Target for Cybercriminals

Multiple reasons make the financial industry one of the most attacked segments in the digital space.

Access to private information means ransom seekers get the upper hand. Accelerated digital transformation has led to a dramatic shift in business processes through large-scale migration of operations and associated data on the cloud.

There is a higher scope of human error due to the massive financial services workforce in the vast landscape. Sensitive digital data is accessible to more than a few trackable individuals with increased third-party collaborations and attempts to offer unified services across the ecosystem. The higher the number of third-party integrations, the greater the attackable surface. Plus, the remote and hybrid work cultures add to the vulnerabilities.

Ongoing technology transition can leave security loopholes. Technology in the domain is evolving rapidly and security systems don’t always keep pace. This raises serious concerns about how FinTechs should mitigate increasingly serious cybercrime while ensuring transformation.

Top Cybersecurity Trends in 2024

Cybercriminals are increasingly using sophisticated technology to perpetrate attacks, while the frequency of cyberattacks has also been rising. Here’s a look at other key trends expected to shape the cybersecurity landscape in 2024 and beyond.

Need for Reforms in Encryption

With quantum computing well on its way to becoming mainstream technology, it is bound to shake up the bedrock of security for digital systems – encryption. Traditional cryptography will be a piece of cake for quantum-powered cyberattacks to breach. Therefore, cyberspace is working towards developing quantum-safe cryptographic algorithms.

Adoption of Zero Trust Models

The digital space is increasingly shifting toward a zero-trust operational model from a trust-but-verify one. Increasing insider breaches require every access request to be considered hostile until proven otherwise. This approach is designed to ensure that security is integrated within each layer of the digital infrastructure and not just the defense perimeter.

Everything Needs To Be Done NOW

Generative and predictive AI models are double-edged swords for cyberspace. AI-powered security models analyze vast amounts of data in real time to fend off attacks and mitigate threats before they manifest into system-wide infections. Intelligent security systems are critical to manage these “intelligent” threats. Essentially, cybercriminals and cybersecurity personnel are racing against each other’s AI capabilities.

A cyber incidence has a lifecycle of 277 days on average. Of this, 207 days are for identification and the rest for containing its impact.

Source: Upguard

Growth of Cyber Insurance

The cost of cybercrime is projected to reach $10.5 trillion by 2025!

As organizations seek ways to mitigate potential losses, cyber insurance is gaining traction. The financial services industry is focused on designing specialized products based on the needs of a business (in the finserv domain or outside of it). This provides the business with capital backup to recover from financial loss, in case an incident occurs. The demand and supply of cyber insurance-based customized products are set to soar in the near and long term.

Data Source: IBM – Cost of a Data Breach Report

Securing the Cloud

As the financial space migrates to the cloud for flexibility and scalability, it introduces new vulnerabilities to the system. Exhaustive security assessments of the cloud infrastructure, data storage, and third-party associations are critical to maintaining the sanctity of the online space. Building a robust cloud-security framework, regularly assessing it for vulnerabilities, and upgrading it at par with evolving cloud-based security protocols and initiatives will become streamlined and an integral part of business operations.

Threat Intelligence Automation

Organizations that use AI-powered security automation save up to $1.76 million.

AI has disrupted every industry. So, why should cybersecurity be left behind? AI-powered intelligent security systems facilitate the integration of cyber defense systems across operations and processes. Cybercriminals already rely on automation to exploit the complete surface area of attack. Data security systems must also be equipped with dynamic and consistent exploration of the threat landscape to mitigate hazards in time. Proactive defense is the best way to minimize threat impact.

Multiple Levels of Security

Fintech firms need to make users aware of security best practices. This includes customers and employees. However, that is not enough. Multi-tier security protocols should be adopted to minimize vulnerabilities and accelerate threat detection. Here’s a look.

Application Level

With the increased adoption of DevOps in fintech, cyber risk has increased. With continued evolution and release, testing time often declines. Incremental integrations may also leave undiscovered vulnerabilities that cyber attackers can take advantage of. Therefore, there is a need to integrate security within application development processes through a DevSecOps-based mechanism.

Cloud Security

With data and operations migrating to the cloud for scalability, accessibility, and reliability, cyberattacks are increasingly targeting online storage. Disparate point solutions further increase data transfer requirements and hence the attackable surface. Banks, credit unions, and financial service providers need reliable and flexible security systems to keep pace with the cloud-based evolution.

In a Nutshell

Data is relevant to the industry to gather insights and offer better products and services. The flip side is that it calls for exceptional security measures. FinTech firms need to stay abreast of the latest cyberattack methodologies and be proactive in mitigating associated risks. It is critical to define policies and procedures to handle untoward incidents. Additionally, ensuring compliance is critical for fintechs to claim insurance and minimize losses.

Regulation

Possible Fines

HIPAA$50 to $50,000 per record
GLBAUp to $100,000 per violation
GDPRPotentially tens of millions of dollars
PCI DDS $5,000 to $10,000 per month

Source: Cyber Insure

Reevaluating or completely overhauling the existing security architecture requires thorough analysis and expert judgment. Leverage the experience of experts at Opus Technologies, who have been enabling digital transformation for FinTechs for over 26 years. With a proactive approach and innovative strategies, our security experts fortify security across touchpoints and internal and external interfaces. 

Contact us to enhance your security and data privacy systems for 2024 and beyond.

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