The adoption of digital transformation in Banking, Financial Services and Insurance (BFSI) has increased over time and has been further accelerated after the pandemic. This led to increased utilisation of digital wallets, fintech application adoption and point-of-sale terminals — allowing new financial lifestyles.
For example, annual fintech app installs in Asia have already grown by 32 per cent from 2022 to 2023. This is twice higher than the global annual install average growth of 14 per cent. In APAC, Thailand, in particular, has been at the forefront of digitalisation with a 95 per cent growth in BFSI applications year on year.
The region’s growing demand for mobile banking solutions further fuels this digital revolution, opening new avenues for global expansion and the enhancement of services. Overall, the digital transformation has reshaped the BFSI sector by modernising operations, enhancing productivity, and providing solutions that enable banking in the new normal.
However, the rise of digital banking is creating new online security challenges, with cyberattacks on financial institutions around the world growing exponentially. According to the IBM Security X-Force Threat Intelligence Index of 2022, Asia was the most attacked region in 2021, accounting for 26 per cent of all attacks. To delve deeper, 70 per cent of these attacks targeted banks. The number of critical vulnerabilities (CVEs) is also increasing by 13 per cent per month this year, as per a report by Coalition.
Furthermore, with the increase in the adoption of Data Protection regulations in the region, companies must ensure they comply with such laws, adding one more layer of complexity to their operational landscape.
In Singapore, for example, organisations that are handling payment data must ensure compliance with both the PDPA and PCI DSS to adequately protect personal and financial information. Without PCI DSS compliance, they are unable to ensure a secure environment for enterprises that accept, process, store, or transmit credit card information.
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Protecting sensitive financial data and ensuring cyber resilience must be at the forefront of every strategy. In order to do so, organisations must understand the BFSI threat landscape and make sure they have a holistic cybersecurity approach.
Understanding BFSI’s threat landscape
The BFSI sector faces a multifaceted threat landscape, with API attacks being one of the prominent concerns. These attacks have the potential to disrupt online services, leading to significant financial losses and irreparable damage to an institution’s reputation.
Unsecured APIs within the BFSI sector pose a grave risk as they can expose sensitive customer data to theft and manipulation, potentially resulting in severe regulatory penalties and a loss of customer trust. In fact, Gartner has predicted that by 2025, 50 per cent of data theft will be attributed to unsecured APIs.
Additionally, the rise of malicious bots has further complicated the threat landscape for BFSI companies. These bots account for over 50 per cent of all internet traffic and are constantly scanning BFSI applications and APIs for security misconfigurations and vulnerabilities.
Within the realm of API attacks, the BFSI sector faces several specific types of threats, including:
- Unauthorised access: Attackers leverage stolen login credentials to gain unauthorised access to user accounts through APIs.
- Security misconfiguration: Attackers exploit API misconfigurations and other vulnerabilities to gain access to sensitive data, potentially leading to data breaches.
- Application DDoS: Attackers flood APIs with an overwhelming number of requests, causing system crashes or slow response times and disrupting online services.
- Man-in-the-middle (MITM) attack: Attackers intercept data transmitted between API endpoints, enabling them to steal sensitive information, posing a significant risk to data integrity and confidentiality.
Handling cybersecurity threats: A holistic approach
To mitigate the risk of cyberattacks on BFSI applications and infrastructure, enterprises need to implement the following best practices encompassing people, processes, and technology.
- Advanced threat detection: Advanced threat detection mechanisms can identify abnormal patterns of behaviour within web applications. Machine learning and AI-driven solutions can help BFSI entities stay one step ahead of cybercriminals.
- Security assessments: Regular security assessments and penetration testing are essential to identify vulnerabilities within web applications. A proactive approach to testing and patching vulnerabilities to prevent exploitation is required.
Also Read: The state of cybersecurity in 2023: How APAC organisations can stay ahead of the curve
- Secure coding practices: Ensuring that web applications are developed with secure coding practices in mind is crucial. This approach involves input validation, output encoding, and parameterised queries to prevent common vulnerabilities like SQL injection and cross-site scripting (XSS).
- Encryption: The significance of encryption in securing data both in transit and at rest cannot be more important. The use of secure protocols like HTTPS and SSL/TLS can prevent data breaches.
- API security: APIs are the lifeblood of modern BFSI applications, so discovering and securing API endpoints against malicious requests is a critical threat plane that should not be overlooked.
- DDoS protection: The high availability and performance requirements of BFSI applications require scalable protection against DDoS attacks, which are increasing in complexity and size each year.
- Bot management: Bot Management solutions help separate benign bots (e.g., search engine bots) from malicious bots (e.g., those attempting Account Takeover attacks), better protecting BFSI customers and greatly reducing unwanted traffic on critical applications and APIs.
With a global shortage of security professionals, most organisations can benefit from dedicated experts who not only set up the latest security solutions but maintain them and offer support teams during attacks. Managed security operations, including 24×7 SOC, deploying cutting-edge technologies, the latest threat intelligence and custom runbooks to enhance overall security posture.
In conclusion, opting for a holistic Web Application and API Protection (WAAP) solution offers a robust defence against the prevalent and high-priority challenges currently encountered by BFSI institutions.
Furthermore, the adoption of a unified WAAP not only bolsters multiple compliance requirements, such as PCI DSS 6.6 and similar standards, but also streamlines security point solutions – leading to cost reduction, enhanced security, and fortified enterprise security posture. These measures collectively constitute a holistic approach to cybersecurity, addressing the multifaceted challenges that BFSI institutions face in the digital age.
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