The way in which we bank has changed dramatically over the past decade. Long gone are the days where we had to venture to the bank, spend hours queuing and then wait 5-7 days for money to clear. Now, transactions occur almost instantly online. We can use our smartphones or tablets to log into our bank accounts and manage everything fully online.
While online banking has certainly helped to make our lives more convenient, there is some debate over just how safe it is. Are banks protected against cyber-attacks? What would happen if a hacker did get into the banking systems? These are genuine concerns, so just how safe is the banking industry against these kinds of security attacks?
What Is Cyber Security?
Cyber security is used to protect IT systems against viruses, hacking attempts and damages. Fraudsters are constantly looking at ways to break through online systems, gaining access to financial information and accounts. This means businesses, particularly within the financial sector, need to be on top of their cyber security to protect both themselves and their customers.
New GDPR rules in Europe have made it even more important for businesses to comply with cyber security regulations. The penalties for not protecting data are now pretty severe, forcing companies to make more of an effort to protect their systems.
What Challenges And Risks Do Banks And Financial Firms Face?
When you’re dealing with major banks and established financial firms, you’ll typically find their security is extremely tight. They know just how important cyber security is and they have dedicated teams which work around the clock to keep their systems protected. However, when you’re dealing with fairly new companies, their security may not be fully up to scratch yet.
For these smaller firms and start-ups, there are a number of challenges and risks presented. These include:
- Outdated systems and software
- Funds to deal with cyber security
- Human error
These are the main risks faced in the industry. It’s also important to note that access to customer bank accounts and financial information can also be unlawfully gained via the customer themselves. If they click on phishing emails for example, the hacker could gain access to their online bank account. However, this would only impact the individual customer and not give the hacker access to other accounts. Therefore, customers also need to take responsibility for their accounts.
How Security Risks Can Be Managed Within The Banking Sector
There are a lot of ways banks and financial firms can manage their security risks. Firstly, it helps to get the professionals in such as RSM. They can help to identify current risks and show how they can be eliminated. Ensuring all systems and software are fully updated is also another great tip. Hackers continually get smarter, so security software also needs to be continually updated and improved.
Overall, banks and larger financial firms do tend to be fully secure against cyber-attacks. However, smaller, start-up businesses and banks do need to be careful if they want to become successful. Hiring professionals to establish the risks is a great first step to take.