Building Resilient and Secure FinTech Infrastructure: Strategies for DDoS Mitigation and Cybersecurity
As the FinTech sector expands, security must stay at the forefront of importance. Fintech companies are targets for cybercriminals attempting to obtain sensitive consumer data because of the growing popularity of online banking and new digital payment methods. It’s critical to have a strong security plan in place to reduce these dangers and safeguard your FinTech application.
A report by Allied Market Research projects that by 2030, the global fintech market will be valued at $698.48 billion. Fintech has received over $14 billion in capital by the end of the first quarter 2023, making it the most invested industry.
Source: Allied Market Research
The factors propelling the FinTech industry’s global expansion include growing customer demand for e-financing, a surge in the use of FinTech in banks and other institutions, and greater internet usage in daily life.
It is clear from the data above that there has been a significant shift in the financial services sector in recent years. Due to the sensitive data of FinTech companies and individuals, this industry is a prime target for hackers looking to make quick money. Therefore, the FinTech sector must be aware of potential cyber security risks.
Why is Cybersecurity Important in FinTech?
Since the early days of digital financial activities, there has been a connection between banking and cybercrime. No matter what causes a data breach — malicious behavior, human error, technical issues, etc. — once information has been disclosed, it may quickly damage reputations and result in significant losses in terms of intellectual capital and property value.
These numbers illustrate how widespread these threats are.
In 2022, the average US data breach cost increased to $9.44 million from $9.05 million the year before. The average cost of a data breach globally in 2022 was $4.35 million.
The top three regions in terms of impact from breaches in the third quarter of 2022 were North America, Asia, and Europe. Half of all Q3 breaches occurred in Europe. (Surfshark).
FinTech and DDoS Security: A Synergy
There are several key reasons FinTech and DDoS security have a symbiotic relationship that cannot be overlooked. FinTech companies must operate in a highly regulated industry where security lapses can have dire legal and financial consequences.
Second, because these businesses hold private and sensitive financial information, they are often the first choice for cybercriminals looking to steal assets and identities. Third, compromised client trust is a major consequence of cybersecurity incidents, which damages FinTech companies’ brands and undermines their commercial plans.
It’s crucial to ensure that DDoS attacks frequently work as a misleading “smoke screen” for other harmful cyber activity, particularly in the FinTech software development services sector. Nevertheless, they still pose a hazard on their own.
Therefore, the most important reasons for every FinTech organization to have the finest DDoS security possible are cybersecurity legislation, maintaining personal records, and maintaining public reputation.
What are the DDoS Challenges in FinTech?
Even though DDoS protection is crucial for FinTech, companies still face some challenges when putting in place and keeping up with DDoS defenses.
1. Quick Innovation
Keeping up with the most recent cyber dangers and countermeasures is difficult given the quick speed of technical change in the FinTech industry. Continuous innovation and development foster an atmosphere where security postures change quickly, raising the possibility of deployed DDoS protections being configured inaccurately and exacerbating vulnerabilities.
2. Observance of Regulations
FinTech organizations are impacted because measuring experiential value and meeting stringent regulatory requirements takes time and resources away from DDoS protection. Since red team tests often cover less than 1% of the online services posture and do not offer comprehensive visibility and insights into the overall DDoS vulnerability gap, compliance measures like these frequently fall short of covering the entire DDoS attack surface.
3. Risks to Third Parties
Due to their heavy reliance on outside vendors for essential services, FinTech companies are susceptible to new cybersecurity risks. DDoS threat actors might target these outside services, which could lead to data breaches or other security flaws.
How Can FinTech Companies Dodge DDoS Attacks?
Companies may have to pay anything from $1 million to over $5 million for every hour of downtime, not to mention any further fines, fees, or penalties under the law. It is in addition to higher DDoS security investments made after the fact and higher cyber insurance premiums. As a result, DDoS victims may have to pay for ransomware. However, this isn’t a fix. It does not ensure that a DDoS assault won’t occur again.
FinTech businesses need to be proactive if they want total DDoS resilience. Regardless of the security services they use, organizations are extremely susceptible to denial-of-service (DDoS) assaults. The only way to withstand such attacks is to implement non-disruptive DDoS testing and obtain uninterrupted and comprehensive insight into the DDoS security posture.
Continuous DDoS testing on live settings is necessary for FinTech firms and their DDoS protection vendors to identify vulnerabilities, prioritize remediation, and ensure that the solutions are applied appropriately. Staying ahead of the threat curve means taking a preventive rather than a reactive approach to safeguarding online services against DDoS attacks.
What Cybersecurity Issues Affect FinTech Companies?
FinTech organizations must address some cybersecurity risks to protect their clients’ data and maintain the confidentiality of their operations, even though this expansion has yielded numerous benefits.
1. Malware Attack
Unlike other intrusions, malware can enter a system through different entry points, such as pop-up windows, malicious websites, email attachments, and third-party applications. The user’s PC may become infected when they click the link supplied through an email or rogue program.
2. Risk associated with Money Laundering
Cryptocurrencies have become a significant cybersecurity issue in the present financial climate due to their widespread usage in recent years. These digital currencies are susceptible to being abused for illegal purposes like money laundering as they are anonymous and decentralized, and it can occasionally be challenging to determine where the money is coming from.
3. Third-party Risks
For services like payment processing and data storage, FinTech businesses rely on outside providers. The data and systems of the FinTech Company may be at risk due to cyber security technology weaknesses in these providers. FinTech security solution providers must do thorough due diligence on external contractors and guarantee that appropriate security protocols are implemented.
Best Cybersecurity Practices for FinTech Companies
FinTech businesses may secure their applications against fraudulent actors by using best practices, some of which include:
1. Robust Security Protocols
To prevent cyberattacks, FinTech applications must carefully build a multi-layer security infrastructure. The username and name of the user should be used first for identification, followed by password authentication and two-factor verification; authorization should then be used to determine the level of access each user is allowed within the system.
By adhering to these stringent procedures, organizations can stop hostile actors from obtaining unauthorized access to user accounts or confidential data repositories.
2. Improving the security of cloud servers and APIs
Back-end security is critical for data protection, and developers must ensure they are ready to respond fast if any vulnerabilities are uncovered. Automating certain chores can be beneficial, but caution should be exercised.
Minimizing the number of third parties participating in such processes will provide additional assurance that all integral pieces fit together cohesively. Purchasing parts from reliable vendors and suppliers is usually advised if sophisticated abilities are needed.
3. Safety Test
Throughout the development life cycle, comprehensive testing is a must to guarantee the highest level of security for your FinTech application. Double-checking potential errors is essential, and time constraints should never be allowed to prevent every step from meeting stringent requirements for data security, performance, authorization, and verification. In addition, real-time monitoring protects against unforeseen problems with the application or any critical frameworks or production methods.
Wrapping Up
The FinTech sector is expanding, and so are the cybersecurity risks. Businesses in this sector must implement best practices and preventative measures to protect their applications from malicious users. FinTech companies can ensure they have a strong security architecture that enables them to promptly detect and address any possible risks by adhering to the criteria.
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