The BFSI (banking, financial services, and insurance) sector has witnessed drastic technology-led changes over the past few years. The digitization of banking services, insurance claims, and information collection has led to massive data possession, which has made the industry a prime target for bad actors. A 2020 study by the IBM Security found that a data breach costs a company in the financial sector an average of $5.85 million.1
From small-time fraud involving individual credit card data to phishing attacks and the more recent larger network-based attacks that put entire systems at risk, security has become a major concern. For instance, Mastercard at one point faced some 460,000 intrusion attempts in a typical day, up 70% from in the previous year.2
The Top Cybersecurity Challenges of the BFSI Sector
- Increase in Cloud Workloads
- Third-Party Integrations
- Complex Security Infrastructure
- Difficulty Meeting Compliance Requirements
- Lack of Visibility
Increase in Cloud Workloads
Banks, like most other enterprises, have increasingly been moving their data to the cloud. This has created new security challenges. The need to quickly migrate to new IaaS cloud environments often results in risks being created through access point misconfiguration.
To keep up with growing demand for convenience and speed, banks had little choice but to make their core offerings and services available online. The industry often looks to third parties to create and maintain the necessary IT environments to facilitate mobile banking. However, gaps in integration can lead to security vulnerabilities. A simple example can be seen in how mobile wallets led to security breaches.3 During the initial stages, several banks worked with nascent tech companies to offer wallet options. This turned into a disaster for many, with hackers using weak integrations to gain access to the main system and exfiltrate confidential financial data.
Complex Security Infrastructure
Another challenge of BFSI is dealing with structured and unstructured data. One of the biggest security pitfalls is the deployment of several point multi-vendor solutions — some enterprises have as many as 45 different vendors deployed across their ecosystem. This often leads to insufficient integration and management, causing enterprises to deal with intentional or unintentional data access and loss.
Difficulty Meeting Compliance Requirements
By virtue of their business, banks and insurance companies tend to be widespread geographically in terms of their presence. This means that they must comply with multiple international/regional regulations and compliance requirements. Complexities increase since data compliance differs in each continent, country, and sometimes, even each state.
Lack of Visibility
The use of multiple solutions to manage specific security problems leads to a lack of visibility due to too many alerts and data coming from different security tools. This lack of visibility, coupled with the shortage of security professionals, makes it difficult to know what is happening across the network. It also complicates efforts to proactively secure sensitive data before an attack.
How BFSI Companies Can Overcome Security Challenges
A Ponemon Institute survey of 400 security professionals across financial services found the BFSI sector to be more “effective in detecting (56%) and containing (53%) cyberattacks than in preventing attacks (31%).”4 Here are several strategies to help BFSI companies implement more preventative measures to thwart cyber threats.
1. Increase Visibility
The importance of solutions that enable granular visibility into cross-segment traffic cannot be understated – even more so when there are multi-vendor data centers. It is vital that the solution offers a centralized view of the traffic between clients and servers hosting critical BFSI applications. With granular visibility of workloads and traffic across clouds, the hassle of using multiple monitoring tools in silos can be avoided. Unified visibility can also significantly reduce detection and response time while enabling security teams to implement policies that reduce unauthorized movements and access.
2. Define Segments to Prevent Lateral Movements
Enabling secure micro-segmentation of data centers spanning bare metal or multi-cloud environments is also a crucial security measure. The segmentation of core financial workloads into separate secure environments will ensure that access to those applications is granted purely on the intent — thereby ensuring elimination of advanced persistent threats (APTs) and unwarranted data exposure.
BFSI enterprises would also be well served to adopt a zero-trust security model that will require strict identity verification for every user and device trying to access resources — regardless of whether they access workloads from within or outside of the network perimeter. Zero trust will have to be enforced with multi-factor authentication (MFA), which will ensure that security is met by insisting on more than one piece of evidence to authenticate a user.
3. Secure Endpoints
Fully customizable lockdown solutions (which ensure tamper-resistant security against known and unknown threats like ransomware, malware, and sophisticated APT lateral threats) can go a long way toward helping BFSI organizations secure endpoints, including transactional servers and ATM kiosks. This can be done by enabling process-level visibility and control of critical assets in the banking system, ensuring that only whitelisted processes are allowed to run. With lockdown solutions, ATM kiosks working on legacy systems and unpatched software can be protected without the need for costly patch management or system upgrades.
4. Simplify Compliance
Tools that simplify compliance reporting and auditing can help BFSI companies meet compliance requirements. Opting for a micro-segmentation solution can help BFSI enterprises reduce the scope of IT audits and compliance audits like PCI–DSS, GLBA, and more. (Micro-segmentation will also be a particularly valuable tool for organizations seeking to comply with the upcoming PCI-DSS 4.0 release.) Reducing scope serves to eliminate risky guesswork and ensure consistent security and compliance across financial organizations’ data centers, saving hours of manual effort, operational headache, and audit costs.
Get Long-Term Security for Your BFSI Business
Where there is profit, there will be people — bad actors in this case — who will be persistent and find innovative ways to circumvent security barriers. Therefore, it’s important for BFSI enterprises to adopt the right cybersecurity approach. Following the above best practices can go a long way toward helping your BFSI business defend against today’s cyber threats.
You can learn more about how ColorTokens helps banks and financial services companies protect against cyber threats by visiting our BFSI security hub.