The fintech industry is booming and seeing an incredible period of growth. You might assume that everything is rosy for the industry—but beyond the incredible rise of some of the most famous fintech brands, there is a whole industry that can face challenges. Indeed one of the most important relates to the fact that many people are worried that the industry isn’t taking cybersecurity seriously enough.
The fintech industry is unfortunately an appealing target for cybercriminals. The reasons for this are multifaceted, but a key point relates to the type and amount of information it collects from its customers and partners. If a fintech business suffers a cybercrime, it can lead to stolen data which can be used for identity fraud or even be sold to other criminals.
It is necessary for businesses to think closely about the kind of cybersecurity they need to put in place. But it is also vital for those interested in using fintech products and software to work out how to integrate those products in the safest way possible.
In this article, we’ll take a look at how cybersecurity impacts fintech businesses and products, and also seek to understand how businesses and individuals can use fintech software in a way that keeps them safe from cybercrime.
Why Fintech Should be Worried About Cybercrime
Cybercrime is on the rise. As the world has become increasingly digitized, perhaps it is unsurprising that such a large amount of crime has moved online. This growth of cybersecurity is certainly troubling for businesses of all sizes, and it seems to only have been exacerbated by the pandemic.
However, that is not the worst of it from a fintech perspective. Indeed, it has been shown in research by IBM that financial services businesses are the most likely to suffer a cyberattack. This means that if a fintech business isn’t putting appropriate resources into defending itself against cybercrime, they can very easily become a victim.
How Cybercrime Impacts Fintech
Cybercrime can have a huge impact on fintech—not only in relation to the businesses themselves but also in terms of the clients that use the software as well as suppliers and partners.
Perhaps the first thing to consider is the actual cost to the business relating to the breach. This might involve the loss of capital, but it can also require the business to close down its operations for a period of time while it solves the issue. Of course, that is before you take into account the damage that it causes to the customer or users, who may have their personal information stolen and then sold on.
This can lead to the further problem of reputational damage. Customers who suffer financially or just simply a loss of data will lose trust in the fintech product and this has a knock-on effect on customer confidence generally. If a business has been breached before, it is proof that it has not taken cybersecurity seriously in the past.
Integrating Products Safely
With so many startups providing products that integrate in complex ways with existing systems, there is the potential for huge challenges. Issues such as poor configuration and undiscovered software vulnerabilities can take what has been a successful integration and turn it into a nightmare. Here are some tips for integrating fintech products with your system.
Working With Specialists
One of the key ways to ensure that fintech products can integrate with your existing system is to bring in the help of experts. Relying on your IT team alone to handle integrating a complex system that they are not familiar with can lead to no end of problems. Get in touch with experienced professionals who have expertise carrying out the kind of integration you are looking to implement.
Overcoming the First-to-Market Problem
There is undoubtedly an issue in fintech revolving around the pace of the industry. With advanced technologies in this sector there is always a rush for companies to be the first to market with their product. This can lead to products that are under-resourced from a cybersecurity perspective, as there simply isn’t enough time to patch all of the issues.
Overcoming this means really being sure that you want to invest in the challenges that a brand-new product brings. It can be smarter to wait until the technology has time to bed in and the issues have been dealt with.
Test and Test Again
Utilizing penetration testing is one of the crucial steps in assessing the security of your system. When you integrate a new fintech product, you should have pen testing carried out. By using the same tools and techniques used by cyber adversaries, pen testing replicates the conditions of a genuine attack.
This type of testing is one of the only ways that you can ensure that integrating products is secure. It is a great idea to work with an outside cybersecurity specialist who can come into the company without any preconceptions. They will be able to provide unbiased tests and scope out potential vulnerabilities.