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How financial services organisations can bolster their cyber security frameworks

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By Anna Webb, Head of Security Operations at Kocho

 

The Bank of England has released a cyber security framework with the intention of helping financial institutions across the UK identify areas of vulnerability that could expose them to cyberattack. Cyber security in financial services is as important as it is complex, notably due to advancements in technology and digitalisation projects, which accelerated during the pandemic. The mass-movement to hybrid working exposed access points to confidential information from outside corporate networks, increasing the risk of attack and putting the onus of compliance onto home-based workers who may not have a security background. All the while ransomware attacks have been increasing in number and sophistication, adding extra pressure.

Indeed, the UK Government’s 2022 Cyber Security Breaches Survey found that 39 per cent of UK businesses have identified a cyberattack in the last 12 months. While there are no quick-fixes to mitigate these concerns, or ease the burden on overworked IT teams, financial services organisations can make significant improvements by breaking down the challenge of bolstering their cyber defences into bite-sized pieces.

How to remain secure in an age of hybrid work

Balancing security with remote work provisions has been a substantial challenge for most organisations. Financial services companies aiming to be modern employers, providing flexibility to employees, have begun to introduce specific security protocols that are reflective of each employee’s job function. These protocols take into consideration the individual applications and systems certain employees need access to in order to complete their role efficiently.

Teams that are likely to continue working from home in the long-term, will continue to need solutions that strengthen their local security posture. In practice, marketing, accounting and admin teams that are still working from home, might require significant authentication steps before logging onto corporate networks. Whereas traders, who are more likely to be back in the office, will remain covered by local, more robust, security protocols.

These cyber security nuances apply equally to financial advisors and commercial bankers, who, in today’s workplace, rely on video conferencing to establish key business relationships. The security tools needed to support these interactions must ensure that any data shared is adequately protected and that access points cannot be opened up by potential attackers.

Outsourcing security

For many organisations, the task of securing all of these complex environments is time-consuming and costly. Organisations that have traditionally controlled their security in house – without robust processes in place for securing external network access – have faced a logistical challenge. So how can financial service businesses de-risk their operations without wasting resources and time?

By choosing to outsource their IT and cyber security, organisations can relieve the burden on internal security teams and gain access to expertise and resources that can keep them ahead of emerging threats. Yet not all providers are created equal. When deciding which managed security service provider is right for them, organisations should look for industry recognised certifications that can confirm compliance standards. These include Cyber Essentials Plus programme and ISO 27001 certifications. Additionally, companies should check supplier credentials by asking for case studies of existing finserv customers.

The case for compliance

Along with the ever-evolving efforts of cyber criminals to find weak spots in business infrastructure, legislation and regulation is also ever-changing, as authorities play catch-up in a rapidly advancing technology landscape. In order to continue to innovate and stay ahead of competitors, financial organisations should emphasise sustainability and safety during their digital transformation efforts, particularly if they are working with third parties that have access to sensitive data.

The recently released CBEST security assessment framework is designed by the Bank of England to aid financial services in bolstering their cybersecurity resilience. This regulatory development is also part of the supervisory strategies of the Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA). Organisations using the voluntary assessments should find it easier to uncover hidden weaknesses and vulnerabilities, which in turn will provide a stepping stone to strategically fortify their systems, while also contributing to the security and functionality of the wider financial network.

The assessment is conducted as a series of realistic attacks performed by a top-skilled cyber threat intelligence analyst. These tests mirror modern hacking techniques, without wreaking havoc. The assessment is also used to indicate how well cyber defences are performing in comparison to the standard key performance indicators. Using CBEST regularly and continuously proves to be an excellent regulatory assessment framework, which also works on a cross-jurisdictional basis, and in cooperation with other regulations and frameworks.

Furthermore, for financial service organisations working with third-party suppliers, it is important to understand the security of their entire supply chain. The spike in supply chain attacks has caused the UK government to design further legislation, known as National Cyber Strategy 2022 (NCS). Its purpose is to support UK organisations in fortifying their IT network security against attacks that are aimed at third party suppliers. Currently in the proposal stage, it is expected to be introduced during 2023.

Conclusion

In this time of economic uncertainty, financial services organisations must be able to operate seamlessly and securely; this includes ensuring customer data is protected.

Even though securing digital assets is becoming more complex, making security feel like a titanic effort, organisations can decrease risk and exposure by focusing on their key requirements. Priority should be given to following recognised security frameworks and controls that include basics like adopting best practice identity management, and building cyber security awareness and best practices amongst employees among others. Combined, these steps go a long way in helping mitigate the risk of an attack.

Finance

astrantiaPay Selects SaaScada to Enrich Swiss Landscape of Business Payments and Fill Market Gap

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Swiss financial firm, astrantiaPay, to use SaaScada’s cloud-native core banking engine to simplify cross-border payments for SMEs and facilitate international trade and services across the old and new economies

 Cloud-native core banking engine, SaaScada, today announced it was selected by astrantiaPay to launch a Swiss point of contact for international businesses looking to open and run corporate bank accounts in Switzerland. Once regulatory approval is in place, astrantiaPay will provide mission-critical payment services to sophisticated Swiss, European, and global companies.

“Promoting SMEs is high on the agenda of policymakers, but the reality is very different when dealing directly with banks. In fact, financial institutions often show little or no appetite for low-margin, labour-intensive company accounts with regular cross-border payments”, explains Lukas Wissner, CEO of astrantiaPay. “As a result, opening and maintaining corporate bank accounts can become a complex and costly procedure, posing a real challenge for Swiss and European start-ups and established businesses. This can hinder growth, and sometimes even threaten a company’s existence. Ultimately, corporate bank accounts with a foreign nexus are an underserved niche segment in the Swiss financial ecosystem which is historically dominated by asset managers and private banking.”

SaaScada is an industry-proven core banking system that unlocks trapped customer value, mitigates risk, and drives real-time data insights. It was founded from a desire to provide first-class financial services capabilities for everyone. SaaScada’s configurable product features and transactional ledgers can be connected to any payment scheme, gateway, channel, or FX provider. Its event-driven architecture will provide astrantiaPay with a real-time stream of events for each company account.

“SaaScada’s experience and deep understanding of how to execute a bank in the Swiss financial and regulatory landscape convinced us,” concludes Lukas Wissner. “Looking back, SaaScada was the right starting point on our integration journey, as its experienced team of programmers readily enable open API connections to virtually any data source and endpoint; be it software tools for onboarding, client relationship management (CRM) and transaction monitoring (TM), or accounting systems, payment aggregators and international correspondent banks. Leveraging SaaScada’s proficiency and infrastructure has helped us create an organic whole.”

“Lukas Wissner and the team at astrantiaPay have a distinct vision to make bank account opening simpler for international SMEs,” explains Nelson Wootton, Co-Founder and CEO at SaaScada. “SaaScada is delighted to support astrantiaPay in driving financial inclusivity for its customers, solving complex compliance challenges, and enabling SMEs to thrive.”

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How Biometric Payments Are Tackling Financial Exclusion

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By Catharina Eklof, CCO, IDEX Biometrics

We are moving closer to a cashless society: 89% of payments in the UK are contactless and, globally, contactless payment transaction values are set to surpass $10 trillion by 2027. Ease, convenience, security, and inclusion have accelerated the transition away from cash. However, many of today’s current payment solutions are leaving entire cross sections of society behind: including the most vulnerable, underserved, and unbanked populations.

Developments in the payment sector over the past decade still aren’t a perfect fit for all. Those suffering from dementia, literacy challenges, or impaired vision can find current payment methods – with a PIN to remember – extremely challenging. Financial inclusion requires us to make payments accessible to all demographics. Though the financially excluded represent minorities, they account for an estimated 1.7 billion people – almost a third of adults globally.

Enabled by huge advances in technology, our evolving social dialogue has become accelerated and unfettered, on a global scale. It is critical to harness technology as a force for dynamic economic improvement: democratizing access to banking and payments. As such, we need to look beyond mobile wallets or digital payments and support those in need of easier access to payment and fintech solutions. A more inclusive form of payment technology is essential.

Catharina Eklof

 

Personal Identity as the New Pin Code

Many communities remain vulnerable or underserved by the functionality of traditional payment solutions such as bank cards. These products are, at their core, only linked to the owner by way of name and signature, offering limited security and protection. With contactless payments, no link whatsoever is required to a card for payment.

In an increasingly contactless society, fraud and digital security are growing concerns. Credit and debit cards can be used by anyone, and card readers don’t understand if cards have been apprehended illegally. Vulnerable groups may also struggle to input their credentials into what can be, for some, a complex system. Empowering those vulnerable groups therefore means providing them with the independence to access payments with greater ease.

Biometric payment cards play a significant role in bridging the gap between the financially underserved and the financially included. Simple and secure financial authentication, like facial or fingerprint recognition, allow payments to become about who a person is rather than what they know or remember. If individuals can be personally linked to a payment card via biometrics, it can address the significant 1.1 billion people worldwide who are currently without official government identification or access to it. In Nigeria alone, 149 million individuals lack the legal means to evidence their identity, while in South Africa, 12 million individuals are excluded from the country’s formal identity system.

Fingerprint authentication has the added benefit of optimizing security, in that it requires the individual to opt into a purchase, avoiding any issues of unauthorized or unintentional payments from having a reader placed near the card owner’s face. This provides increased independence for the blind and visually impaired, who account for an estimated 2.2 billion people globally, as it allows for seamless payment authentication without sensory barriers. Similarly, biometric smart cards can be transformative for more than 55 million people living with dementia and Alzheimer’s, as it enables access to payment without the difficulty of remembering passcodes.

Literacy is also a little talked about hurdle to inclusion. Globally, there are 750 million “functionally illiterate” individuals struggling to use and understand financial products. Across all levels of education, biometric authentication is a universally inclusive concept. It is easy to communicate and understand that one’s fingerprint is inherent to their identity, and can act as a form of verification. Biometric smart cards facilitate and secure payments with ease by simply requiring their fingerprint to instantly authenticate their own card.

 

Pushing on With Progress

Even the most reluctant individuals are likely to have succumbed to contactless payments and some form of digitized banking in recent times. This will have the positive impact of making the needed transition to biometrics more seamless. Using fingerprints or facial recognition to unlock phones or access apps is not unusual. If anything, they have been convenient and comforting additions to the surge of tech innovations over the last couple of decades. There is a relief in knowing that these portals are being secured by methods that are almost impossible to replicate.

It is a breakthrough that financial players and governments in the world’s most developed countries still need to catch up with, as emerging economies have already capitalized on biometrics’ capabilities for almost a decade now. In India, for example, internal fraud and leakage from pension payments dropped by 47 percent after transitioning from cash to biometric smart cards. Because the solution bypasses the need for prior credit ratings or credentials, the country has also been able to catalyze safe online banking among previously unbanked adults since biometrics’ introduction in 2014.

Meanwhile, in Pakistan, the total number of mobile wallet accounts tripled from 5 to 15 million in 2015, with an estimated 50 percent of new registered mobile wallet accounts opened using biometric authentication. This was a result of Pakistan’s National Database and Registration Authority’s (NADRA’s) effort of collecting biometric information to allow for more convenient and democratic account opening processes.

Many around the world have been marginalized by both the pace of change in banking and the solutions that have, to this point, been created to accommodate such change. With the mass adoption of biometric smart cards, the same benefits seen in India could be realized on a global scale. If we take on the opportunity in front of us – promoting solutions like biometric smart cards to increase accessibility to the global economy – we will foster a digitally-focused, equitable and inclusive society. This doesn’t just mean ease and convenience, but also security for all and financial inclusion of those who have been left out of digital evolution, until now.

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