Today businesses of all sizes have digital technology. More than 2100 fintech companies in India alone have digitised every possible consumer interface. But unfortunately, this transformation has also made them vulnerable to cyber-attacks. As per a recent ImmuniWeb survey, 98 of the top 100 global fintech startups are prone to cyber-attacks. Hence, these companies are in critical need to adopt cyber resilience.
This article will see the top 4 reasons why fintechs must not progress without cyber resilience.
What is Cyber Resilience?
While cyber security stands for protection tools and mechanisms to thwart any cyber-attack, cyber resilience is a broader term. Cyber resilience stands for a companies’ ability to apprehend, prepare, respond and recover from any cyber-attack whenever it takes place.
It defines the organisation’s ability to bounce back on its feet after an online attack with the least harm to the business and its customers.
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Cyber Security Risks Faced by Fintechs
Today, cyber-attacks are aimed at governments and a few select companies. All kinds of businesses and individuals face threats from hackers.
The risk is heightened as all kinds of financial services are now available online. This is evident because, in 2020, cyberattacks in the financial sector rose by 238% globally.
With the booming eCommerce industry, cyber financial frauds will likely increase by 130% in the next two years. (What’s the future of fintech resilience – UKTN | UK Tech News |)
The fast pace of digitisation with lax regulatory framework makes the fintech sector a sitting duck to future cyber-attacks. Hackers can easily paralyse the functioning of an entity with tools like Malware, Ransomeware, etc.
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This brings us to:
Top 4 Reasons that Call for Cyber Resilience of Fintechs
The past two years have seen the rise of fintechs in India. As per the Global Fintech Adoption Index, India is a significant contributor to this trend. In addition, due to rapid digitisation, 80% of Indians have a bank account now.
However, this progress of fintech has also made all the stakeholders more vulnerable targets to cyber-crimes. According to data by cybersecurity firm Micro Trend, 73% of organisations in India expect consumer data breaches by the end of this year.
These vulnerabilities intensify the need to become cyber resilient for the fintechs currently booming in India. Let us examine why it is in the interest of these new-age financial companies to have cyber resilience as a part of their growth plan:
1. Overall security
Cyber resilience is more than some cyber security tools which induce a false sense of security. It takes a 360-degree approach to cyber security and prepares the organisation to face and function in the wake of any cyber-attack.
Rather than on and off safety tools, cyber experts design ways and strategies to strengthen the existing IT infrastructure of a company. These measures not only cover the IT network of a company but are across the departments.
2. Covers financial loses
In March 2021, IT firm Tech Mahindra faced a ransomware attack while handling the smart city project for Pimpri Chinchwad municipal corporation. The attack delayed the project by a month, causing a loss of Rs 5cr.
A cyber resilience program of a company takes care of such unforeseen incidents. It not only apprehends the future danger but also works out means to handle and neutralise the effect of such cyber threats. This reduces financial losses.
3. Prevents loss of reputation for companies
Today anything from a pizza to a car can be bought or sold online. People click the payment button on their apps because they trust their credit/debit card details to be safe with the seller.
However, when a data breach happens, the customers feel betrayed, and the company loses its reputation. According to a survey by UK telecom provider, TalkTalk lost 7% of its customers in 2015 due to a cyber-attack. Due to data theft, over 3lac customers left the company for a new service provider. (New Research Reveals Extent of Reputation Loss After a Cyberattack – Web Filtering (spamtitan.com)
A cyber resilience program ensures that the business of a company stays afloat in case of such cyber-attacks leading to data breaches. It is also meant to cause minimal to no discomfort to the customers.
4. Keeps the IT team on its toes
Today, not only nations but even enterprises are targets of cyberwar. These attackers are always two steps ahead of their victims and succeed in overpowering the latter.
A cyber resilience program keeps the IT team of a company on its toes. Unlike current IT teams that handle technical issues, a resilient team devises ways to counter any possible cyber threat. They are like tech soldiers ready to address any hypothetical cyber safety problem.
Better Prepare than Be Sorry
As technology advances, cybercriminals find novel ways to beat it. While it may not be possible to read their mind, fintechs can better prepare themselves with cyber resilience to minimise the overall damage of such attacks. It is always better to be prepared than to be sorry.
Precisa offers a cutting-edge bank statement analysis suite for lenders and banks to help them make unanimous lending decisions. With secured lending taken care of, they can invest more valuable time and resources into building cyber resilience.
Do you want to be abreast with the latest news in the world of fintechs? Are you looking for ways to up your cyber safety measures, then reach us at contact@Precisa.in
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