Technology is changing the finance industry, for better or for worse.
The proliferation of devices make it easier than ever for institutions to reach consumers, understand their needs, and personalize experiences. Every swipe, tap, and click turns into big data that teaches you more about your consumers.
But the growing number of touchpoints also means greater opportunities for sensitive data to land in the wrong hands.
A recent study found that financial services is among the top five industries that faced major data breaches last year.
These challenges will only become greater in the coming years. Intel predicts that the number of connected devices will grow to 200 billion by 2020, which means more data to protect and more devices to secure.
“The more digital we all become, the more security risks we face,” says Lewis Daniels, founder of Salvador Group. ‘But security does & always will go back to the basics. Human interaction is the weakest link and making this more fool-proof will be key.”
Here are the top three ways your data is at risk and how you can protect your clients and your business.
1) Challenge: The digital landscape is becoming more fragmented
The average American now owns four devices on average. Which means consumers are constantly hopping from channel to channel and device to device. It can be easy for your branding to get lost in the mix of ads, online reviews, and emails.
To stay relevant, financial institutions having been adapting emerging technology such as beacons and geo-targeted messaging. Older institutions have been acquiring newer, innovative startups. New integrations require different resources and processes to secure them. And legacy systems that remain are often not updated or maintained.
“Vulnerabilities in cybersecurity are being exploited on multiple fronts,” says Steven J.J. Weisman, Esq., professor at Bentley University.
Externally, cyber criminals use techniques such as spear phishing and ransomware. Internally, because of the competitive market, some employees may exploit company information for stock trading.
Solution: Building a Branded Cross-Channel Experience
Establishing a consistent user experience and educating users on your brand identity can help mitigate some of these data breaches.
At Bitly, one way we’ve seen financial institutions build cross-channel brand integrity is through Branded Short Domains and customized URLs.
Companies can set up their own Branded Short Domains to replace the default “bit.ly” at the beginning of the Bitlink.
For example, a New York-based commercial bank might send a welcome text message to a new customer with the link “ba.nk/nywelcome.” This branch could also follow up with an email that includes a trackable, branded link like “ba.nk/getstarted.”
This personalizes the user experience and also creates a more secure experience – all Bitlinks support https and the Branded Short Domain will be exclusive to the bank. If customers see a non-branded link, they might think twice before clicking.
One added plus: Branded Short Domains are also proven to drive up to 34% higher click-throughs.
2) Challenge: Providing a Secure, Personalized Mobile Experience
Another place to tighten the user experience is on mobile.
Consumers open financial mobile apps 30% more than any other type of app. But cybercriminals are increasingly targeting consumer bank accounts on mobile phones. A a rise of malicious software programs like Acecard and GM Bot are making it easier for criminals to steal banking credentials from consumers on mobile.
We’ve also seen a rise of SMiShing, phishing via SMS. Scammers will send mass text messages built to look like they are coming from a user’s bank. The text messages will prompt a password reset or ask for other personal information that help hackers gain access to the account.
Solution: Mobile Deep Links
That’s why it’s so important to use mobile deep links. By detecting the right device and sending users directly to the right app or an app store, deep links can create a frictionless experience that takes clients to the right time at the right place every time.
The Associated Press (AP), for example, uses Bitly’s Mobile Optimizer, a feature of Bitly Enterprise, to integrate deep links into social sharing buttons across all of their articles and enable deep linking for every story.
By ensuring that mobile readers opened the app by default, the publisher saw 500,000 app opens and 3,500 visits to the app store in one month… an estimated $12,000 value.
3) Challenge: Rising Costs
While we’re getting smarter at how we communicate with consumers, cyber criminals are also getting more sophisticated at how they hack, share, and sell data.
We have been seeing a rise of organized cybercrime. Hackers team up together to work as an organization, pooling time and resources to build stronger, more advanced attacks.
There are also a growing number of tools for the less experienced or even non-experienced individual to launch a cyber attack. Many underground bots are easily downloadable and come with instructions, ready to be used right off the shelf.
Cybercrime damage costs are estimated to hit $6 trillion annually by 2021.
As cybercrime rises, companies will have to invest in more technology, software, and talent to both actively fight and defend against these attacks.
There are also a growing number of government regulations and agencies put in place to help strengthen security.
“Firms must manage an alphabet soup of data-specific regulations and agencies, including FINRA, FISMA, FFIEC, OCC and also PCI and HIPPA compliance rules,” says Brian Berger, executive vice president of commercial cybersecurity at Cytellix.
This is another layer of compliance for firms to dedicate resources to understanding and maintaining.
Solution: Increased communication between financial institutions
Continued communication and cooperation between leaders in the financial industry will help fend off a lot of these attacks.
Dan Klein, attorney at law at Kane Russel Coleman & Logan PC predicts that there we will see increased cooperation among financial institutions this year. Most recently, we saw eight major banks come together to form the Financial Systemic Analysis and Resilience Center whose mission is to identify, analyze, assess and coordinate activities to fight cyber attacks.
Big data also helps break down silos and promote transparency.
Using third-party data software can help you easily organize, consolidate, and share insights that help inform security, like which devices consumers engage most with and how certain channels are used.
Solution: Cloud-based services
Cloud-based monitoring tools will help reduce headcount and the need for multiple platforms. These services will help firms spot weaknesses in the user journey and flag attacks in real-time.
“Increased visibility into status and threats will be essential in 2017 as financial firms strive to remain in compliance while also reducing operational costs,” says Berger.
According to IBM’s Chief Technology Officer, cloud computing reduces IT labor costs by 50%. Many companies also report that cloud-based services give them more flexibility of their services and more control of their data.
Solution: Turn on and Encourage Two-Factor Authentication
Two-factor authentication, or 2FA, adds an extra layer of security to your basic login. By turning on 2FA for all of your employee accounts and encouraging your clients to do the same with their accounts, this can help minimize the possibility of a hack.
“Two-factor authentication uses a method, such as sending a code via text message, to do a secondary verification before allowing access to an account. Currently, only a handful of banks use two-factor authentication and therefore their account holders are at risk. I believe over the next year you’ll see banks and other financial firms turn to 2FA,” says Brian Berger, executive vice president of commercial cybersecurity at Cytellix.
Hacking Your Way to a Secure Future
As the digital landscape grows and the financial industry evolves along with it, companies will experience some growing pains.
The rise of devices will inevitably create more platforms for cyber criminals to target. It means more ground for firms to protect, search for blind spots on, and maintain a branded presence across.
Mobile banking solutions, especially, will have to put measures in place to tighten the user experience and educate clients on identifying authentic content.
By building internal databases and external networks that help you see where consumers are engaging and which platforms are used most heavily you will be able to identify potential blind spots and weaknesses.
Fighting cybercrime starts by being able to see clear across your user journey.