In 2022, India made history by surpassing the United Kingdom and claiming its spot as the fifth-largest economy in the world. With continued investment in infrastructure, an increase in the ease of doing business, a favourable demographic and a move to a digital economy, the Indian financial services industry is evolving at an accelerated pace. Advances in technology have enabled consumers across the country to have greater access to financial services.
However, new opportunities bring new challenges. With the rise of online banking, mobile payments and cryptocurrencies, financial institutions must now navigate complex security and privacy issues and invest in protecting customers’ sensitive financial information.
The Indian economy is currently poised for significant growth and development in various sectors. However, for this growth to be sustained, regulations and compliance measures must be strictly followed as they ensure a level playing field for all market participants, promote transparency, prevent fraudulent activities, and build trust among investors and consumers.
This sounds easier said than done for the sector, which is a prime target for cybercriminals in Asia, according to a 2022 industry report. The report recorded 283 incidents in the first half of 2022 and 469 incidents in 2021.
Addressing data breaches
Because financial services networks are so complex, there are multiple ways for hackers to attempt to break in. The consequences of a data breach, on the other hand, can be severe and wide-ranging as the industry is highly regulated. A hack in the system can compromise the sensitive financial and personal information of an institution’s customers. This can lead to identity theft, fraudulent transactions, and financial harm, which can trigger additional regulatory investigations and potential fines. Moreover, it results in reputational damage and loss of trust from customers, leading to a decline in business and revenue.
Protecting your network from within
Ensuring the safety of the IT network of a financial services institution has a human aspect to it, as nearly 64 percent of financial service companies have more than 1000 sensitive files that can be accessed by any employee.
In fact, most security incidents appear from employees failing to follow security protocols or data protection policies. Those can be addressed by continuously educating your employees on the importance of data protection and the risks associated with it, setting clear policies and guidelines on the expected behaviour, and actively promoting good security practices.
Selecting the right tools for your organization
A financial services institution is likely to be equipped with numerous security management tools that generate alerts whenever suspicious activities are detected. However, these could result in an overwhelming volume of notifications for the team and may lead to no proper action being taken to detect and address the actual threats.
Investing in a platform with many capabilities like bandwidth monitoring, log management, application performance monitoring, network traffic analysis and virtualization monitoring will provide the IT teams with deep insights into the status of the networked devices and systems. By analysing network logs and generating reports, IT teams can ensure optimised network performance and carry out security forensics to determine what happened and why. IT personnel can take steps to minimise the ongoing damage caused by the breach and prevent similar incidents from occurring in the future by blocking the source.
In financial organisations, a secure network, and protected data equal long-term business success. Given the rapid financial growth expected in India, the Indian financial sector needs a robust, safe, and compliant financial network that can support the expansion of the Indian economy and ensure the financial security of its citizens. By regularly monitoring systems, maintaining access controls, and ensuring data integrity, financial organisations can safeguard against cyber threats, ensure compliance with regulatory requirements, and maintain the trust of their clients and stakeholders.
(This article is written by Larry Goldman, Director, Product Marketing, Progress, and the views expressed in this article are his own)