Top Cybersecurity Trends Ruling the Financial Market
The surge in the digital transition comes at the price of increased cybersecurity risks. As a countermeasure, enterprises need end-to-end cybersecurity solutions
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While 2020 was all about the COVID-19 pandemic, it allowed the digital world to flourish, with businesses investing more and more resources in developing frameworks to interact with customers online. The demand for technologies like Artificial Intelligence (AI), real-time cloud computing, and machine-learning-based systems outgrew the existing solutions in the market.
Unfortunately, the surge in the digital revolution came at a price of increased cybersecurity risks, since perpetrators became active on digital platforms as well. As a counter to these concerns, enterprises and SMEs started employing quick and efficient cybersecurity solutions to combat perpetrators from hijacking customer identities.
Trend #1 - On-Premises Solutions
With digitization becoming mainstream in the past few years, data breaches have seen an exponential rise as well. Not only traditional database systems, but cloud-based businesses are also under increased threat if they lack robust security policies and procedures. Making sure data is not accessible to third parties and other unauthorized vendors created the need for better alternatives such as an on-premises solution.
In-house systems like these can offer greater data residency of customer data and make the identity verification process much more streamlined. Businesses are now adopting on-premises IDV solutions to introduce automation in customer onboarding. These are particularly useful for financial institutions that are always on the verge of data breaches and digital fraud.
Trend #2 - Multi-Factor Authentication (MFA)
As per the findings by IBM, the average cost of a data breach lies between $3.9 million to 4.24 million. A good counter to these instances is incorporating additional layers of security in the form of multi-tier verification. Enterprises and mid-sized companies are already using MFA solutions to make digital transactions, account logins, and customer onboarding.
Despite the added cost, two-factor authentication (2FA) and subsequent MFA methods have proved to be a great source of data protection and preventing unauthorized entities from accessing business services. MNCs and startups alike now focus on multi-factor authentication combining OTP codes & biometric-based tools for a foolproof analysis of customers, their identities, and transactional activity.
Trend #3 - Blockchain Systems
Blockchain has become inevitable in today’s tech-driven world, where digital solutions are a need of the hour for every business to survive the fierce market competition. Systems built on blockchains are one step ahead of traditional security frameworks that are now easily outwitted by bad actors using sophisticated tools and technologies. Now, users can perform digital transactions with minimal intervention from any external vendor, central authority, or third party.
Blockchain acts as a viable cybersecurity mechanism when it comes to protecting sensitive personally identifiable information. Since data is stored on an online secure ledger, they are less likely to be intercepted by “man in the middle” attacks and other identity theft incidents.
Trend #1 - AI-backed Services
With cyber threats like phishing emails, synthetic identity fraud, and facial spoof attacks, businesses particularly those operating in the financial services industry are under an increased burden of regulatory compliance. But thanks to artificial intelligence and its products like facial recognition and automated document-based checks, financial and corporate organizations can perform real-time verification of potential customers, saving them tons of operational cost and time.
AI-powered solutions are much more effective when it comes to detecting deep fakes, missing holograms and rainbow prints, or extracting information from the MRZ (Machine Readable Zone) code on government-issued identity documents. These automated checks offer a great means to combat cybersecurity risks such as social engineering and compromised identity information.
Summing it Up
Today, it is critical for companies to buckle up their security infrastructure to fight financial crime and keep fraudsters at bay by incorporating efficient and quick ways of screening customers at the time of onboarding.
Moreover, multi-stage authentication, blockchain-based transactions, and AI-backed services contribute to a fail-safe system free from external threats.
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