Cyber Security for FinTech (Financial Technology)
You may ask, why this is a relevant conversation right now…
Africa as a continent, is already the largest adopter of mobile money transfer systems globally. We have been able to leapfrog various financial technologies and go directly towards fintech, thus improving the continent’s financial access gap. However, like every fast-developing technology, innovation precedes regulation.
Fintech is a relatively new concept and therefore not regulated as much as the traditional Financial Services sector therefore opening room for bad actors. Fintech companies handle individuals’ money and personal data through services such as digital payments, mobile money transfer, mobile banking, insurance services, cryptocurrencies, etc. This combination of financial services on technology platforms makes it an attractive target for cyber criminals. There is therefore a critical need to place high value on data protection and information security in the sector.
For a Fintech based organization, there are various Cyber Security threats and challenges you need to look out for:
- 1. Identity theft and fraudThe act of using stolen information of a person’s personal or financial information.
- 2. Malware, DDOS, Ransomware (cyber-attacks)Cyber-attacks have risen in the recent years with a majority through such attacks as Ransomware and DDOS (Denial of service attacks).
- 3. Network and application securityApplications are at the heart of most fintech organizations. Cyber attackers can figure out the vulnerabilities from the application to gain access to the entire network.
- 4. Data securityFintech organizations collect, manage and store huge amounts of data daily. The larger the data sets, the higher the risk for the company. If cyber attackers breach the application and steal user data, companies are held liable by regulators due to breach of data regulations and laws.
- 5. Compliance and regulationThere are an increasing need to comply with various information and data protection laws pertaining to the financial services sector. Regulators require fintech companies to implement certain procedures with dire consequences if these are not met.
- 6. Money launderingIt is no secret that illegal proceeds of criminal activities sometimes do find their way to the financial sector. Cybercriminal scan use fintech companies as conduits for illicit funds.