Synopsis: The Indian financial industry faces the most significant threat from cyberattacks today. Dive in with us to know the best practices to protect sensitive information from unwanted security breaches in compliance with ISO 27001, SOC 2 Type II, PIPEDA, and HIPAA.

Do you know that 97% of data breaches are financially motivated? That said, the financial industry faces the maximum threat from cyber attackers around the globe. This is easy to acknowledge because the Indian financial sector faced 13 lakh cyber attacks between January and October 2023. That translates to 4,400 cyber-attacks every day. The RBI has implemented stringent compliance regulations to manage cyber risks and ensure compliance within the Indian financial industry. This article will cover the top cybersecurity threats faced by the Indian financial sector and discuss ideal practices to manage cyber risks and easily maintain compliance. Let’s get started.

Top Cyber Security Threats Faced by Banks

Financial domains are lucrative targets for cybercriminals to steal money and sensitive information. These are different types of threats that financial institutions face:

Phishing Attacks:

Sometimes, scammers try to steal sensitive information, such as usernames, passwords, credit card numbers, etc. They dupe the victim through various means to disclose personal information. This is called phishing. For instance, they can send you a fake email that mimics an official email from your bank asking you to confirm your information through a text message link.

Malware (malicious software):

Malware is a medium for hackers to hack company networks or personal laptops/smartphones to steal sensitive information. One of the best ways to avoid malware attacks is to install firewalls or antivirus software on such devices and use highly encrypted technology while doing financial transactions.

Denial of Service (DoS) attacks:

Sometimes, scammers flood a network with false information to disrupt the operation. This phenomenon is commonly referred to as a “Digital Deluge” assault. Such attacks are usually resolved without paying a ransom. However, identifying and neutralizing the attack takes the organization’s valuable time, money, and other resources.

Identity-based attacks

Nearly 80% of cyber attacks involve using fake identities, which takes 250 days to identify the victim. Here, the attacker steals the victim’s credentials and mimics the user’s behavior to hack into the financial system.

Code Injection Attack

In this case, the attacker injects malicious code into the computer network of the financial institution to steal, extract, or alter sensitive information from the database. In such types of attacks, hackers often use SQL Injection techniques or malvertising attacks to carry out their purpose.

Now, let’s understand the different dimensions of cybersecurity you should aim for securing a financial domain.

Different Dimensions of Cybersecurity

These are essential dimensions of cybersecurity to protect sensitive information from unwanted breaches.

Application security: protection of applications after deployment with antivirus programs, firewalls, and encryption 

Infrastructure security: protecting corporate infrastructure, such as network communications, data centers, IT platforms, and connected devices

Information/data security: securing confidential and sensitive financial data from unwanted access, disclosure, damage, modification, and disruption

Cloud Security: protecting cloud computing setups from both

external and internal cyberattacks

Identity and access management security: defining user roles and strengthening access privileges of individual network users 

Regulatory focus: ensuring compliance with RBI guidelines on cybersecurity framework

End-user education: educating end users regarding protecting sensitive information from cyberattacks through proper security measures

Best Practices To Avoid Cyberattacks

Let’s discuss the best practices for securing any financial domain from brutal cyberattacks.

Adopt Advanced Technologies and Tools

Nowadays, businesses leverage advanced technologies like AI, Machine learning, and Blockchain to detect anomalies, predict threats, and quickly secure transactions. For instance, you can use Blockchain to create a decentralized, secured financial transaction. You can also use natural language processing to analyze and understand threats from unstructured data sources. 

Keep software up-to-date

Software updates are meant to strengthen the application with new features or fix old bugs. If you are not using the old application, it offers a clean gateway for malicious actors to hack into your system.

Avoid spam emails

If an email looks suspicious, there is a high chance of it being a phishing scam. Sometimes, they may also contain attachments or links to infect your device. You should avoid opening them at all costs.

Use data encryption

Use a secure file-sharing option to encrypt data while sharing confidential financial information. For instance, regular emails may not protect unwanted logins through credentials, but a paid data encryption tool can offer protection per ISO 27001, SOC 2 Type II, PIPEDA, and HIPAA Compliance.

Use strong passwords and multi-factor authentication.

Creating solid passwords using uppercase and lowercase letters, symbols, and numbers is highly recommended. The more complicated it is to guess for anyone, the better. Also, it is imperative to implement multi-factor authentication. You need to verify your identity from two different devices to eliminate the likelihood of identity-based attacks.

Conduct Periodic Cyber Audits

Conduct periodic cybersecurity audits at least once a year to defend against risks. If you are dealing with big data or personal information, twice a year is necessary to keep up with compliance and legal requirements. Take the help of the best auditors to streamline your process with top-class tools and processes.

Monitor third-party users and applications.

If you have given third-party access to your systems and applications, there is a chance of a data breach. Malicious actors can use those mediums to launch cyber attacks. Thus, it’s best practice to monitor user activity, restrict access to sensitive information, and use OTPs to prevent breaches easily.

End Thoughts

The continuous cybersecurity threat to the financial landscape cannot be ignored. Therefore, financial institutions must focus on building a robust security threat monitoring system powered by advanced technologies and tools. The tips in this article are not exhaustive but essential

to maintaining robust security and compliance. Read this guide to know how financial institutions can best ensure customer data privacy.