What is Cybersecurity in Banking?

The main objective of cybersecurity in the banking industry is to protect the user’s assets. There are more online acts and transactions as more individuals go cashless. Consumers make purchases using electronic payment methods like debit and credit cards, which require cybersecurity protection.

Current State of Cybersecurity in Banks

Indian banks reported 248 successful data breaches by hackers and criminals between June 2018 and March 2022; the government alerted Parliament on August 2, 2022.

11,60,000 cyberattacks were reported by the Indian government in 2022. It is predicted to increase by three times from 2019. India has been a victim of significant cyberattacks, including the phishing attempt that almost led to a fraudulent transaction worth $171 million against the Union Bank of India in 2016.

Union Bank of India was the victim of a hack that involved online banking and caused a large loss. One of the officials opened a questionable link after falling for the phishing email, which gave the malware access to the system. Using phony RBI IDs, the attackers gained access to the system.

Banks are required to improve their IT risk governance framework, which calls for the Chief Information Security Officer to take a proactive role in addition to that of the Board and the Board’s IT committee in ensuring that the appropriate standards are being followed.

Reasons Why Cybersecurity is Important in Banking

Cybersecurity has a high priority in the financial sector. Establishing credibility and trust is crucial because it forms the basis of banking. Here are five reasons you should be concerned about cybersecurity in the banking sector. They include:

1. Everyone appears to be utilizing digital payment methods like debit and credit cards and to be completely cashless. In this situation, it is crucial to make sure that the necessary cybersecurity precautions are in place to secure your privacy and data.

2. It could be challenging to trust financial institutions after data breaches. That’s a big problem for banks. A poor cybersecurity solution could easily result in their customer base relocating their business elsewhere due to data breaches.

3. You typically lose time and money when a bank’s data is compromised. It might be uncomfortable and time-consuming to recover from the same. It would involve canceling cards, going over bills, and keeping an eye out for problems.

4. Improper use of your personal information could have serious consequences. Even if the cards are banned and fraud is immediately dealt with, your data is sensitive and may reveal a lot of information that might be used against you.

5. Banks must be more careful than the majority of other businesses. The cost of keeping the kind of valuable personal data that banks do is that. The bank’s information could be compromised if it is not protected against cybercrime concerns.

Figure 2. Challenges relating to cybersecurity in digital banking.