The rising cost of fighting cybercrime in financial institutions has revealed a big gap that Atlantic Canadian fintech innovators can fill with their rich financial experience and tech expertise.
In the last decade, banks have started focusing on user experience and convenience by moving most of their operations online, and this has opened the doors to new risks by cybercriminals. Owing to the sensitivity and high value of data involved, an attack on financial institutions can quickly snowball into a problem of much bigger scale.
So, what makes banks more vulnerable than other industries and sectors?
- The continued digitization of financial services
- The fragmentation and obsolescence of certain banking information systems
- The interconnection with third-party information systems and, by extension, migration to the cloud
According to a cybersecurity report by Akamai, 94% of reported cyberattacks against the financial services sector were carried out by one of these four methods: SQL Injection (SQLi), Local File Inclusion (LFI), Cross-Site Scripting (XSS) or OGNL Java Injection.
With 76% of Canadians primarily banking online or through their mobile device, Canadian banks have invested heavily in cybersecurity. Over the past decade, our banks have spent $100 billion on technology, which includes technology dedicated to security measures. They are investing in digital transformation, to not just enhance customer experience, but also to keep up with the rapid pace of new technologies and the evolving cyberthreats. Costs to stay current and to fight crime are both constantly rising, not to mention the efforts and time invested in digital transformation.
However, is this enough? For Accenture’s Ninth Annual Cost of Cybercrime Study, conducted jointly with the Ponemon Institute, LLC, they surveyed 400 security experts across financial services, 56% reported that their organization effectively detected cyber-attacks, whereas it is only 31% in preventing attacks.
The study also revealed another large gap: financial institutes are better equipped to detect and contain security threats than they are at actively preventing attacks.
Here is where Atlantic Canada’s fintech companies come into the picture.
The region has a long and rich history of financial experience, that is strengthened by today’s strong backend operations for financial institutions. Our understanding of the unique needs of financial institutions, combined with operations knowledge, position us well to build cybersecurity solutions that increase operational efficiency while reducing investment in digital transformation.
Solution design involving collaboration and interference at appropriate levels can reduce discovery costs for banks and improve overall resilience. We have pioneers like Beauceron who are building impactful automation capacity for cybersecurity, that include involving a company’s employees in preventing attacks, to make it more operationally efficient.
We have a skilled and talented international workforce with strong global networks, expansive technology infrastructure, strong cybersecurity knowledge, and accessible programs to boost innovation. We need to take the next step.